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LG Electronics, LG Micron to Exchange Business Divisions |
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Written by Philip Buonpastore
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Friday, 22 February 2008 |
SEOUL, KOREA - LG Electronics has announced that its board has approved an agreement to exchange LG Electronics' PCB division with its affiliate LG Micron's
plasma rear panel division. This restructuring agreement will
reportedly improve efficiency and raise equity for both companies.
According to the agreement, the transfer and acquisition will take
place on May 1 and will include assets, liabilities and human
resources. Accounts receivable, accounts payable, and some real estate
will be excluded.
LG Electronics sites the increased efficiency and cost effectiveness
of producing both plasma display panels and rear panels
together as its reason for the move. LG Micron will reportedly
boost its efficiency as well, by producing components in house, once it acquires
LG Electronics’ PCB division.
LG Electronics is the largest stockholder of LG Micron. This agreement
will increase LG Electronics’ stake in the LG Micron from 36% to 55%t.
On May 1, LG Electronics will transfer $141.1 million of assests to LG
Micron, which includes two PCB manufacturing facilities in Chungju and
Osan, Korea, as well as property, equipment and machinery.
The agreement will be brought before shareholders of LG Electronics and
LG Micron at respective shareholder meetings for approval.
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