TCL to focus on display panels in US$690 million plan
Chinese home appliance giant TCL Group will focus on semiconductor and display products through an asset integration plan valued 4.76 billion yuan (US$690 million).
Shenzhen-listed TCL plans to restructure to focus on its semiconductor and display business, selling its stakes in several subsidiaries dealing in consumer electronics and home appliances to unlisted firm TCL Industries Holdings, which was set up in September.
TCL is spending 200 billion yuan in six manufacturing plants to produce display panels, which are used for screens in mobile phone, consumer electronics and TVs.
They include five existing plants — including one which opened in November — and another due to open next year.
The restructure will help TCL to focus on next-generation display and improve business performance, Li Dongsheng, CEO of TCL and a home appliance veteran executive, said in a statement to the Shenzhen Stock Exchange.
It’s necessary for a firm to “narrow business scope to gain a competitive edge”, Li has said previously.
TCL plan has been approved by sharehoders but still needs approval from regulators.
Display panels are the most expensive items in many devices, especially TVs. But Chinese companies prefer to buy from giants such as Samsung and LG.
However, Chinese firms such as TCL and BOE have invested heavily to develop more advanced panels.
In November, TCL-controlled CSOT said it would start trial production of a new panel line with a total investment of 46.3 billion yuan CSOT’s T6 line will produce 90,000 units monthly.
CSOT also announced a more advanced LCD panel line, the T7, which produces panels for TVs with bigger screens and super high-definition such as 8K.
In December, BOE said it would invest 46.5 billion yuan to build a plant in Fuzhou in southern China to produce new-technology display panels for smartphones and other electronic devices.
The project will produce screens with AMOLED — or active-matrix organic light-emitting-diode — display technology, which is used in high-end smartphones and other devices including the iPhone XS, iPhone XS MAX and Samsung's flagship models.
Xiaomi this month announced it would buy 65 million shares of TCL to take a 0.48 percent stake.
TCL showcased its latest display technologies at CES in Las Vegas.
