LG Display agrees sale of Chinese LCD plant for $1.5 billion

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FILE PHOTO: People visit the LG display at the international consumer technology fair IFA in Berlin, Germany September 2, 2022. REUTERS/Lisi Niesner/File photo

SEOUL (Reuters) -South Korea's LG Display said on Thursday it had agreed to sell its stake in its large liquid crystal display (LCD) plant in Guangzhou, China, to TCL's LCD unit CSOT for 10.8 billion yuan ($1.54 billion).

The sale includes LG Display's 80% stake in its large LCD panel plant and 100% of its LCD module plant, and is expected to be completed in March 2025, the Apple supplier said in a statement.

The move is meant to better focus its business on its organic light-emitting diode (OLED) operations, LG Display said, in which it is more competitive than in the saturated LCD market.

"We plans to focus more on the OLED business to enhance our business competitiveness and build stable profit bases. Also, we expect capital from the (plant) sale to help strengthen our financial stability," LG Display said in a statement.

With the sale, LG Display will no longer make LCD panels in China. It continues to produce higher-margin large-sized OLED panels there.

Analysts have said a sale would help LG Display's financial structure, after it reported several quarterly losses last year and this on weaker demand for gadgets that use display panels.

($1 = 7.0173 Chinese yuan renminbi)

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