Sony, Samsung dissolve panel joint venture
Sony Corp. said Monday that Samsung Electronics Co. will buy all of Sony's shares in the joint venture for about 1.08 trillion Korean won ($935 million) subject to a final agreement.
Sony's TV operation has lost money for seven straight years and the company is straining to return that key business to profit.
The prices of TVs as well as panels have been dropping so it makes more sense to buy panels at the market rate than to invest in production.
Sony, which makes Bravia TV sets, does not make its own LCD panels.
It said it will enter a new partnership with Samsung to buy panels, and will also continue buying panels from other manufacturers.
Sony said it will suffer a loss of 66 billion yen ($846 million) for the third quarter of this fiscal year, which ends later this month, because of the declining value of investment in S-LCD.
Getting out the production venture will produce substantial savings after January 2012, when the deal is completed, according to Sony.
It was still unclear how Sony's profit forecast for the fiscal year through March 2012 will be affected, said company spokesman Takashi Uehara.
©2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.