SEOUL, South Korea LG Electronics Inc. is in negotiations to sell off its OLED business line to its display panel joint venture LG.Philips LCD Co., Ltd., a senior LG executive said during presentations on the company's second quarter earnings.
"Negotiations on the handover of our OLED business division to LG.Philips LCD are in progress," Park Seong-Ho, head of LG's IR said Wednesday (July 18), adding the aim is to avoid duplicating investment by both companies.
The LG Group believes there is no need for the two family companies to invest in the same business line, Park said without elaborating on the deal. The joint venture between LG and Philips is keen to expand its OLED business, the companies say.
LG Electronics currently operates two PM-OLED production lines in Gumi, South Korea, with a combined annual production capacity of 2 to 3 million PM-OLED display units for use in mobile phones. Since 1999, the company has invested a total of Won 200 billion (about $208 million) in its OLED business, according to LG.
If the deal goes through, LG.Philips is expected to begin mass production of AM-OLED during the fourth quarter of this year.
LG.Philips LCD is currently developing AM-OLED products. Earlier this year, it also signed an agreement with Eastman Kodak Co. to jointly evaluate and develop active-matrix OLED technology.
LG Electronics is known to hold more than 37 percent of equity shares in LG.Philips LCD, the joint venture with Philips Electronics NV of the Netherlands.