Company signs conditional deal to sell the LCD polarizing plate business to China’s Ningbo Shanshan for $1.1 billion
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LG Chem Vice Chairman Shin Hak-cheol receives a briefing on the EV battery pack housing as he tours Dongshin Motech located in Haman,Gyeongsangnam-do. LG Chem plans to focus on the new material business OLED and EV batteries.
LG Chem is tying loose ends in the disposal of a major business in the LCD material sector, marking its exit from LCD sector entirely.
The reason is that LG Chem, which has lost competitiveness in the LCD sector to Chinese businesses, is focusing its capabilities to nurturing new opportunities such as organic light-emitting diode (OLED) and battery sectors.
LG Chem recently struck a conditional deal to sell the LCD polarizing plate business to China’s Ningbo Shanshan for $1.1 billion (about 1.3 trillion won), it said on June 10.
Under the deal, LG Chem’s LCD polarizing plate plants in Najing and Guangzhou will be handed over to Ningbo Shanshan.
If the deal is confirmed with the pending approval by each company’s board of directors, a public notice on the contact will be made. But the sale of some LCD polarizing plate products for automobiles will be excluded from the deal.
A polarizing plate attached to the front and back of the LCD panel is a film to penetrate or shut down light. LG Chem saw the polarizing plate once peak 2 trillion won in annual sales, accounting for a 27 percent of the global market and becoming its mainstay business.
But the Korean company profit in the display panel and materials businesses sharply dropped due to Chinese counterparts’ offensive. Of late, Korean display firms’ withdrawal has dwarfed LCD demand.
In this context, LG Chem has decided to dispose of the businesses related to the LCD sector or withdraw from them. LG Chem handed over LCD color photoresist to Jiangsu Yoke Technology Co for 58 billion won in February and the Korean company decided to exit the glass substrate business.
Instead, LG Chem plans to ramp up its capabilities in the OLED land EV battery businesses.
The company plans to nurture OLED polarized plates being produced in Korea as a mainstay business. LG Chem will focus on investing in the R&D of small- and medium-sized OLED polarizing plate and P-OLED (plastic-OLED) and process protective film.
And 1.3 trillion won LG Chem will secure by disposing of the LCD polarizing plate business will be funneled to expand EV battery plants. LG Chem plans to invest more than 30 trillion won in the EV battery sector by 2024.
LG Chem has drawn up plans and follow up them with massive investments. The company has set aside about 3 trillion won in battery facility investments this year.
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Officials with LG Chem’s EV battery production line in Ochang, Cheongju, Chungcheongbuk-do, examine EV batteries, produced by the production line. (Photos: LG Chem)
LG Chem Unveils New Vision beyond Chemicals
LG Chem proclaimed the New Vision that reestablishes its identity, one that is not only based on ‘chemicals’ but ‘science’ to take a new leap.
Regarding this, LG Chem announced that it held a Digital Live Vision Proclamation Ceremony that all employees could watch with Vice Chairman Shin Hak-cheol and about 20 key employees of each business unit as panels on the 7th.
At this ceremony, LG Chem announced its new vision, ‘We connect science to life for a better future’.
The New Vision represents one based on science such as knowledge, technology and solutions accumulated by LG Chem so far, not to mention knowledge systems of all fields (Science).
It also combines them organically with knowledge in new fields to create unprecedented innovation in the world (Connect), as well as to make life more abundant for customers and all of humanity (Life for a better future).
