Samsung mulls spinning off LCD flat-screen business
15 February 2012
Samsung Electronics Co today said that it was thinking of spinning off its loss-making LCD flat-screen business, a move designed by the South Korean electronics giant to shift to the next-generation technology OLED display.
The move comes amid slowing demand and falling prices of LCD panels that have dented profits and the Suwon, South Korea-based company saw sales dip more than 10 per cent and posted an operating loss of 750 billion won ($669 million) on revenues of 23 trillion won ($20.5 billion) last year.
Samsung, the world's largest television and flat-screen maker, said that it will focus on new technology such as the organic light-emitting diode (OLED) displays.
The company's thinking may have also been triggered after Sony two months back decided to pull out from an LCD joint venture with Samsung after eight years of losses.
Samsung is not the only LCD panel maker facing problems in this segment; its domestic rival LG Display has been posting loss for the fifth consecutive quarter, while Sharp, Japan's largest LCD panel maker has forecasted a record $3.70 billion net loss for the year to March 2012.
In an effort to cut costs, Sony, Toshiba and Hitachi last year agreed to merge their LCD businesses to create the world's largest producer of touchscreen liquid crystal displays.