Samsung Spins Off LCD Business

Following the division's losses in 2011, Samsung has decided to spin off its LCD business as a separate company from the rest of the firm's activities.

While research from GfK shows that 2011 was a great year for TV sales—in fact, TVs have never sold so well—growth and revenues from the sector are down. This is mostly due to LCD TV prices, which have been falling steadily since 2005.

Samsung has paid the price of this, clocking up losses of 750 billion KRW (around £420 million) over the last five quarters. As a result, the firm has decided to separate its LCD division from its other activities. The new company, provisionally called Samsung Display Co, will officially come into existence on 1 April with 750 billion KRW of capital.

Samsung claims that spinning off this business will allow decisions to be made more easily and resources to be handled more efficiently.

According to analysts, this operation will allow Samsung to concentrate on investing in its more profitable activities, such as OLED screen production. A study by DisplaySearch has shown that OLED TVs should account for 16% of the TV industry by 2018, and be worth approximately £12.5 billion.

Otherwise, spinning off the business in the form of a separate company could also allow Samsung's LCD division to be sold off more easily if the need arises.


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