Sony abandons plan to boost stake in Japan LCD plant: report

November 27, 2010 | 20:47

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Sony has scrapped a plan to raise its stake in a joint venture with Sharp manufacturing liquid crystal display (LCD) panels because of a tough business environment, a Japanese newspaper said Saturday.

source: images.businessweek.com

Sony had planned to boost its stake in Sharp's LCD factory in Sakai, western Japan, from the current seven percent to 34 per cent by April next year so that it could be fully involved in the venture's management.

But it abandoned the plan in the face of a strong yen and a slowdown in sales of television sets worldwide, the evening edition of the Yomiuri Shimbun reported.

Instead, Sony will increase its purchases of LCDs from Taiwanese companies which offer less expensive panels than Sharp, the newspaper said.

Sony, whose television business is expected to suffer losses for the fiscal year to March 2011, has been urged to review its LCD procurement plan although it will maintain the current seven percent stake in the factory, Yomiuri said.

The venture, one of the world's largest LCD manufacturers, supplies panels to the two companies in line with their ownership ratios.

Sharp is a pioneer of LCD screens, having launched one of the world's first LCD pocket calculators in 1973.

AFP

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