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LG leaving 'all possibilities open' for mobile unit, sale tipped
- LG has confirmed a memo to employees on the future of the mobile division.
- The memo reportedly claimed that “all possibilities are open” for the unit.
- Another outlet claimed that a Vietnamese firm is interested in LG’s North American business.
The last five years or so haven’t been kind to LG, as the firm recorded a long string of loss-making quarters and lost market-share to rival manufacturers. Now, it seems like the company is considering drastic measures.
According to ZDNet Korea and the country’s Yonhap News outlet, LG Electronics CEO Bong-Seok Kwon sent out an email to employees stating that “all possibilities are open” for the future of the smartphone business.
“LG Electronics has come to the point where it is time to make the best choice by calmly judging its current and future competitiveness in the mobile business. Currently, all possibilities are open and the direction of business operation is carefully reviewed,” the CEO was quoted as saying by the outlets. He reportedly added that “in principle,” members of the division will still be employed regardless of the outcome.
An LG spokesperson confirmed to Android Authority that an email was indeed sent out to employees, but clarified that there was no mention of a sale or lay-offs:
The internal memo was simply to address (mostly) local Korean rumors by informing employees that nothing had been decided yet on the future of our mobile business but that management was keeping an open mind. To summarize, it said: ‘LG Electronics management is committed to making whatever decision is necessary to resolve its mobile business challenges in 2021. As of today, nothing has been finalized.’
However, Korea’s NewsPim reports that Vietnam’s VinGroup — the parent company of nascent smartphone brand VinSmart — is interested in acquiring LG’s North American smartphone operations.
It’s believed that LG’s smartphone sales network, after-market support center, R&D center employees, and Latin American production plant belonging to the US business would be prime acquisition targets in the event of a deal.
North America is LG’s most popular market, with the firm taking third place in the US with 13% market-share in Q3 2020. So any company picking up the North American business would theoretically have a strong position in the region from the get-go.
Do you think LG should sell its smartphone business?
VinSmart in particular is virtually unknown outside Vietnam, but the company joined ZTE in being among the first to offer phones with under-display selfie cameras. More specifically, the VSmart Aris Pro packs a 20MP camera under the screen.
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