Japan is planning to push forward as a global leader in manufacturing smaller LCD panels which are used in smartphones and tablets, with a government backed plan to invest in a merged Sony and Toshiba small LCD operation.
The Nikkei reports that the two companies are in the final states of negotiations towards merging their operations.
According to the Wall Street Journal, the government-affiliated fund, Innovation Network Corporation of Japan will invest in the new company to counter Asian rivals who are ramping up investments in the booming tablet and smartphone component sector, as well as economic and production pressures mounting in the LCD TV panel market.
If realised, the move would create the world’s biggest producer of small liquid crystal display panels for smartphones and tablets, with DisplaySearch figures showing Toshiba held 9.2 percent share of the small LCD market, and Sony had 6 percent market share in 2010.
Both Sony and Toshiba have not commented on the fund’s proposal, according to Japanese sources.
The demand for smaller panels is said to be surging due to the popularity of smartphones and tablets.
In 2010, Sharp held the top spot for a gloabl share in the smaller size LCD market with 14.8 percent, followed by Korean giant, Samsung, which had 11.9 percent, according to DisplaySearch. Taiwan’s Chimei Innolux held a 11.7 percent share.
