Samsung has announced on February 14 its plans to spin-off its LCD Display division, saying that it would make a final decision in about three months, pending shareholder approval. This news doesn’t come as much of a surprise after Samsung reported a loss of around $665 million, even after boasting LCD TV sales of around $20.1 billion in 2011.
In a far speedier decision making process than its initial three month plan, Samsung today announced the creation of Samsung Display, a spin-off of its display business, that will begin operations from April 3. If you’re unsure about what spin-off entails, it basically means that a parent company (Samsung Electronics) creates another company (Samsung Display) that operates independently of the parent company, with its own executives(CEO, COO, CFO, etc.) and staff. Samsung Display will still be 100% owned by Samsung, but this move makes sense from a business and operational standpoint.
Donggun Park, the previous head of the Samsung Electronics LCD business and new CEO of Samsung Display, stated that he was hoping to make Samsung Display a well-respected company, through continuous efforts to supply a large variety of customized products and to gain a competitive edge in the market.
Samsung Display is already a large entity by itself with over 20,000 employees and 5 manufacturing units, but the business will likely get even bigger with plans of a merger with Samsung Mobile Display, its OLED production operation, on July 1. While the plans envision two separate LCD and OLED divisions, the company will eventually shift its main focus to OLED manufacturing, as OLEDs displace LCDs as the primary display technology in consumer electronics. This is only natural, considering that Samsung has been one of the biggest advocates and road openers for the implementation of OLED in mobile and media applications.
Here’s to hoping that Samsung Display achieves its goal of “being the very best in the display market.”