Sony will be selling off their LCD stake to joint-venture partner Samsung for $939 million, which will save the company about $640 million a year.
Sony and Samsung set up a joint venture to build LCD panels in 2004, and now after seven years Sony is selling off their fifty percent stake to Samsung in order to buy at more competitive prices and to save the company millions annually, reports Deadline.
The news broke out on Sony's official website on Monday, the company saying: For Sony, this transaction will enable it to monetize its shares in S-LCD and aims to secure a flexible and steady supply of LCD panels from Samsung, based on market prices and without the responsibility and costs of operating a manufacturing facility. With whole ownership of S-LCD, Samsung anticipates heightened flexibility, speed and efficiency in both panel production and business operations.
Samsung and Sony created S-LCD, located in South Korea, for their LCD panel manufacturing. Transfer of power and complete payment will be made final at the end of January, according to Sony.
Though Sony is known for their televisions and gaming console, the Japanese company will be placing their focus on competing with Apple in the tablet market as well as other consumer electronics like mobile phones and laptops. CEO Howard Stringer has spent $8.4 billion in acquisitions to help Sony's mobile market share, according to Deadline.
Sony recently has been seeing less than favorable numbers during their quarterly reports for the last four years, more than likely fueled by the weakened economy. As CNET reports Sony is also being sued over the PlayStation's recently updated terms of service, which has seen troubling numbers and data theft earlier this year.
Currently Samsung is in the number one spot for LCD distribution, Sony has trailed behind to number three, right behind LG.