LG Philips wins $5 billion flat-screen supply deal

LG Philips LCD, a leading manufacturer of high-tech flat screens, announced yesterday that it has signed a contract to supply $5 billion in computer monitors over the next three years to U.S.-based Hewlett-Packard in one of the biggest deals of its kind. The contract is a major boost to LG Philips LCD, for liquid crystal display, which saw sales last year amounted to 8.3 trillion won ($8.2 billion). The company said the sales would likely lift its production of the screens for laptop close to that of world leader Samsung Electronics. LG Philips LCD is already the global market leader in LCD screens for television and billboards, while holding second position behind Samsung in supplying flat screens for computers. Samsung Electronics accounts for 25.7 percent of LCD monitors for laptops worldwide; LG Philips LCD 20.6 percent. To meet the demand, LG Philips LCD said it will increase production on major factory lines with expectations of adding a more modern facility in the first half of next year. LG Philips last month opened a major LCD plant in Paju, Gyeonggi province. Hewlett-Packard Vice President Kirk Moul, who attended the contract signing ceremony held in Seoul, said the purpose of the strategic alliance was to expand the fast growing laptop market through secure supply of top quality products from LG Philips LCD. News of the contract helped boost LG Philips LCD’s share price yesterday by 2.7 percent to 53,000 won. Samsung Electronics lost 1.5 percent to close at 480,500 won, its price lowest since May 12. The rival screen maker showed little concern over its competitor’s new contract. “Samsung Electronics has been supplying LCD monitors to the world’s largest computer company, Dell,” said a Samsung Electronics official. “The contract has little significance since international orders are not concentrated only on a single company,” the official said, adding that Hewlett Packard, the world’s second largest computer company, only increased orders from LG Philips LCD. by Yoon Chang-hee, Lee Ho-jeong