What's Behind the Big Deal between Samsung and Corning
What's Behind the Big Deal between Samsung and Corning
  • Korea IT Times (info@koreaittimes.com)
  • 승인 2013.10.24 22:18
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SEOUL, KOREA- Samsung Group and Corning Inc. of the United States have strengthened their 40-year relationship in an unprecedented equity transaction. Samsung Display, a Samsung Group company, became the largest shareholder of Corning with an investment of US$2.3 billion. In addition, Samsung Display will transfer its entire stakeholding in Samsung Corning Precision Materials, a Korea-based joint venture created by Corning and Samsung Display, to Corning.
 
Samsung Corning Precision Materials has been a goose that lays the golden eggs for both companies. The maker of glass substrates, a critical part of TFT-LCDs, reported a sales revenue of 5.616 billion won and a net profit of 3,399 billion won in 2010. Since 2011 when a downturn in the LCD industry began, however, the company's fortune has fallen flat. Last year, its sales revenue stopped short of 3,245 billion won, with net profit remaining at only 1,355 billion won.
 
Under these circumstances, it seems Samsung figured it would be hard for the LCD business to recover any time soon. Instead, it made its bet on the OLED (organic light-emitting diode) business, the area considered the next-generation display to replace LCD panels. For Samsung Group that has just completed a restructuring project for Cheil Industries to separate its fashion business and give it to Samsung Everland, it is time for Samsung Corning to go through a similar restructuring exercise for its LCD glass substrate business.

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