updated 12:35 am EST, Mon February 20, 2012
Samsung spinout backs shift to OLEDs
Samsung on Monday confirmed rumors it was spinning out its LCD business. The group, to be renamed Samsung Display, would separate from its parent on April 1 pending approval. It would start off with $667.3 million of working capital.
The move is intended primarily to keep Samsung's core business profitable. Its LCD performance has been mixed as success in smartphone and tablet displays has been countered by trouble with traditional computers and TVs. Most of Samsung's recent success has been tied to its OLED displays, which dominate high-end smartphones like the Galaxy Note and soon promises to take over its TV lineup. The OLED division is staying within Samsung.
The swap could have an impact on companies that depend on Samsung for display manufacturing work, such as Apple. Although its work is often already outsourced, its health wouldn't be directly sheltered by Samsung and could leave it more vulnerable.
Samsung not only has to compete with its Korean neighbor LG but Sharp, Sony, and numerous lower-cost companies in and around China.