By Kevin Parrish AUGUST 12, 2013 1:00 AM - Source: Cheil Industries
Samsung is beefing up its OLED arsenal.
In a regulatory filing last week, Samsung Group affiliateCheil Industries said it agreed to purchase a 50.1 percent stake in German OLED specialist Novaled AG for $155.5 million USD. Samsung Electronics will also purchase a separate 40 percent stake in the company for an undisclosed amount. The remaining stake of around 10 percent is currently held by Samsung Venture Investment which will maintain its current shareholding.
The news arrives after unnamed sources said back in July that Samsung was close to signing a deal to acquire the German company so that it could meet the increasing demand for new OLED-based products. The purchase reflects the company's commitment to invest in a high growth market as well as technology that's energy-efficient and capable of creating flexible screens.
Cheil Industries was established in 1954 and has reportedly propelled the development of Korea's textile industry. It began to expand into additional industries in the 1980's including a chemical business in 1989 and electronic chemical materials in 1996. Cheil acquired Ace Digitech in March 2007 to launch a polarizing film business, a core component of LCD panels.
"Leadership in future display market[s] will be determined by technological capacity," said Cheil Industriesí CEO Jong-Woo Park. "This acquisition is expected to generate significant synergy in new-generation OLED materials R&D and will play a critical role in enhancing Cheil Industriesí market position as a global leader in electronic materials."
Launched in 2001, Novaled AG specializes in high efficiency, long-lifetime OLED structures. Its OLED displays and customized solutions are based on a combination of organic conductivity doping technology, proprietary materials and OLED stack development expertise. Thus the end product has optimized performance, power efficiency, stability and lifetime while manufacturing complexity and costs are decreased.
"Through the acquisition of Novaled, Cheil Industries will be able to lead the change in the OLED market by leveraging Novaledís technology and patents, and successfully positions itself for a new phase of growth as global market leader in display materials," Cheil Industries said. "According to DisplaySearch, the global OLED market is expected to grow rapidly from US$6.8 billion in 2012 to US$20 billion by 2017. Cheil Industries plans to grow Novaledís existing R&D activities and concentrate a main part of its OLED R&D strategy in Dresden."
As part of the transaction, Cheil Industries and Samsung Electronics will also acquire the shares of founding partners of Novaled, the company said.