Samsung Display has decided to sell its entire Cheonan Gen.5 LCD equipment, which manufacturers LCD (liquid crystal display) to China’s Truly. It is heard that price is about $50.88 million (about 61.3 billion KRW). (Related article: First page of article from 11/13/2015) [Picture 1]
According to Chinese press and South Korean industries, Samsung Display has decided to sell its L5 equipment to China’s Truly.
As the selling has been finalized, small and medium product lines will be made based on OLED176 (organic light-emitting diode).
Samsung Electronics’ L5 Line is a facility that produces small and medium LCD panels for laptops, monitors, 32-inch TVs and others and has capability to produce 100,000 to 120,000 sheets per month. Samsung Electronics stopped its operation since end of last year as depreciation had been finished since long time ago and as equipment is worn out and has been looking for a business to sell it to.
Truly has been considered as the business in which L5 Line is sold to since long time ago because it has an experience of buying Samsung’s Cheonan Gen.4.5 L4 Line Production Facility in the past. After buying L4 Facility in 2014, it has been using it to produce LCDs for low and medium-priced phones and others.
Samsung Display is planning to clear up its small and medium LCD Lines that are worn out by selling L4 and L5 Lines. It is not planning to sell its Gen.5 LCD L6 Line, which is identical to L5, and is changing its process from a-Si-based (amorphous Silicon) process to oxide process.
Samsung Display is planning to focus on OLED176 and not LCD from small and medium panels because it had received good results by supplying OLED panels to Chinese Smartphone manufacturers last year.
It is expecting that OLED will be applied to low and medium-priced models and not just for flagship Smartphones this year. Proportion of sales of small and medium OLED panels had increased during 4th quarter of last year. [Picture 4]
“It is predicted that growth of Smartphone markets will be slower compared to last year and growth will take place based on low-end products.” said Director Lee Chang-hoon of Samsung Display during last year’s announcement of 4th quarter performance. Samsung Display’s strategy is to diversify product lines from flagship to low-end products to respond to area of markets that are growing and to increase number of customers.
It is also planning to focus on expanding flexible OLED markets for Smart Watches, Head Mount Display (HMD), displays for vehicles and others. Even though it is small and medium sizes, there is a high chance of markets expanding and technologies developing since OLED is a high-added value product and its markets are just starting to form. It is also planning to go after new markets such as laptops, monitors and others. [Picture 2] [Picture 3]
Samsung Display has not decided what to do with unused site after selling L5 equipment. Although it has not decided on its plans with annual facility investment, it is planning to have mass-production system ready as soon as possible so that it can quickly respond to changes in markets with A3 OLED Production Line.
Staff Reporter Bae, Okjin | withok@etnews.com (specializes in display)