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Samsung Electronics Invests in Sharp's Display Business

By Michael Low & Ng Chong Seng - on 8 Mar 2013, 12:09pm

Samsung Electronics Invests in Sharp's Display Business

A 7-inch HD IGZO display prototype from Sharp

It’s official: Samsung Electronics is going to be a 3% owner of Sharp. This will be carried out through the issuing of about 35.8 million new shares (which equates to 3.08% of the voting rights) to Samsung Electronics Japan. In return, Sharp will receive a capital investment of about 10.4 billion yen (about US$111 million).

According to Sharp’s press release, the purpose of this capital alliance is to ‘build up mutual trust relationship toward increase in the corporate value of Sharp and Samsung Electronics in the field of liquid crystal display business, and at the same time to enhance Sharp’s capital adequacy.’ In other words, Sharp needs the money, and Samsung wants to ensure continued supply of Sharp’s LCD panels in the long run. Surely, that also means that we shouldn’t be surprised when we see Sharp’s IGZO LCD tech appearing on Samsung’s products, such as smartphones, laptops, and monitors.

Expectedly, not everyone is happy with the deal. As reported by the Wall Street Journal, the deal has drawn flak from many Japanese social media users.

Source: Sharp, WSJ