Sony Corp. said Monday it will terminate its joint venture with Samsung Electronics Co. for producing liquid crystal displays for televisions.
Sony will sell its 50 percent stake in South Korea-based S-LCD Corp. back to Samsung for 1.08 trillion won (¥73 billion), making S-LCD a wholly owned subsidiary of Samsung. The transaction is expected to be completed by the end of January, it said. In connection with the action, Sony expects to log an impairment loss of about ¥66 billion in the September-to-December quarter, while reducing its procurement costs by approximately ¥50 billion annually.
Established in 2004, S-LCD expanded production facilities in line with growing demand for LCD televisions. Sony has invested 1.95 trillion won and received around half of the venture's LCD output in accordance with its investment ratio. But prices of LCDs have since declined sharply as demand to replace TVs fell in Japan, with the transition to digital terrestrial broadcasts nearly complete.