In a filing with regulators, LG Display said it has signed an agreement to transfer its stake in its Guangzhou liquid crystal display (LCD) panel and module manufacturing plants to China Star Optoelectronics Technology after receiving board approval.

The transaction is expected to close on March 31, 2025.

LG Display holds an 80% stake in the LCD plant and 100% in the module plant.

lg display
LG Display officially withdraws from the large-size LCD panel market. Photo: LG Display

The deal is part of the company’s broader strategy to shift its focus from the LCD market to OLED, improve competitiveness and build a sustainable profit base. As such, LG Display will no longer produce LCD panels in China, but will only produce large-size OLED panels there.

According to Ked Global, it also means that the Korean company will completely withdraw from the large-size LCD panel market. By the end of 2022, the company will stop producing LCD panels for TVs at home.

LG Display is scaling back its large-size LCD panel business under pressure from Chinese rivals. In recent years, the company has shifted to higher-margin OLED panels. Analysts say the sale will help the company’s finances after several quarters of losses last year.

Ked Global believes that following the deal, the overall TV panel market will shift from LCD to OLED. LG Display plans to consolidate its leadership in the premium TV market by expanding its lineup of expensive large-size OLED panels, differentiating itself from competitors. The company is also working to improve product quality and reduce raw material costs to ensure higher profit margins.

Demand for large-size OLED TVs has recovered since the beginning of this year, supporting LG Display's plans. Meanwhile, in the small and mid-sized OLED panel market, the company will use its production capacity to increase its market share in the high-end segment.

Although it no longer produces large-size LCD panels, LG Display continues to sell high-end LCD panels for the IT and automotive sectors.

(According to Yonhap, Ked Global)