LG Display, the world's second-biggest maker of liquid crystal display (LCD) panels, has sought alliances with Asian TV makers to strengthen its client base and reduce costs.
The LG-Amtran joint venture will be set up in Amtran's existing production base in Suzhou, China, with initial funding of $20 million (11.11 million). LG Display will own 51 per cent of the new company and Amtran, maker of Vizio brand LCD TVs, will hold the remaining 49 per cent.
The joint venture will produce three million LCD modules and five million LCD TV sets annually, with operations set to start early next year, LG said. It did not disclose the value of any additional investments to be made.
Leading LCD makers, including the number one ranked Samsung, LG Display and third-ranked AU Optronics, face a slowing global economy that has hit demand for new flat-screen TVs and personal computers.
LCD monitors and televisions makers such as Sony and Samsung are in a fierce price war, and LG Display and AU have cut output recently in light of weakening demand.
Amtran built its business by joining with US partner Vizio in 2005 to penetrate the North American market.
Shares in LG Display dropped 6.65 per cent to end at 25,250 won (12.50), compared with the broader Seoul market's 4.06 per cent loss. Amtran shares fell 1.05 per cent to T$18.9 (33p), outperforming the Taipei market's 3.31 per cent loss.
Get the ITPro. daily newsletter
Receive our latest news, industry updates, featured resources and more. Sign up today to receive our FREE report on AI cyber crime & security - newly updated for 2023.
ITPro is a global business technology website providing the latest news, analysis, and business insight for IT decision-makers. Whether it's cyber security, cloud computing, IT infrastructure, or business strategy, we aim to equip leaders with the data they need to make informed IT investments.