"Approval Required for Mergers of 7 Countries"
"Sale Price May Change... Will Not Be Less Than 2 Trillion"
LG Display announced that its goal is to complete the Guangzhou liquid crystal display (LCD) factory in China by the end of the first quarter of next year.
Kim Seong-hyun, LG Display's Chief Financial Officer (CFO), said during a conference call held after the announcement of the third-quarter earnings on the 23rd, "The stock purchase agreement was signed on the 30th of last month," adding, "We also need to obtain approvals related to the business combination from seven countries going forward."
Earlier, LG Display disclosed on the 26th of last month that it would sell its large LCD panel factory in Guangzhou, China, to CSOT, a subsidiary of China's TCL Group. The sale price is 10.8 billion yuan (approximately 2.03 trillion KRW), and the expected disposal date is March 31, 2025.
CFO Kim explained, "The approval process must be completed for the transaction to close, after which we will receive the remaining payment and complete the settlement process," adding, "The expected timing is targeted for the end of the first quarter of next year."
He also mentioned that the sale price may vary. CFO Kim said, "Since the sale process began in early summer 2023, the 10.8 billion yuan amount was calculated based on the status as of the end of December 2023," and added, "Regarding equipment and production-related assets, depreciation is not applied, and the settlement will only reflect the difference between the amount calculated as of the end of December 2023 and the management performance of the Guangzhou LCD factory in the first quarter of next year, including liabilities, working capital, and borrowings."
He stated, "Since the Guangzhou entity achieved profitability this year, the actual settlement amount is unlikely to be less than the disclosed amount," and evaluated, "It was a good deal where both the buyer and seller are 'win-win'."
LG Display plans to focus the 2 trillion KRW secured from the sale of the Guangzhou factory on the organic light-emitting diode (OLED) business to strengthen its competitiveness.
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