Flat-screen maker LG.Philips raised $1bn from an IPO of shares in its liquid crystal display (LCD) production unit, after reducing the number of shares on offer by a quarter and pricing the issue at at the lower end of the forecast range in response to investor fears of a coming glut.
LG.Philips LCD, the world's second largest flat-screen manufacturer after Samsung Electronics, launched the offering as the prices of LCD screens begin to fall thanks to an increase in supply - a development that may also stimulate higher consumer sales.
"Investors were not too excited by new LCD shares," said Yu Chang-eyun, technology analyst at BNP Paribas Peregrine. "This is not a particularly good time for investing in the LCD sector. There is no earnings growth to come in the next three to four quarters."
Meanwhile Samsung announced a boost to flat-screen production with the launch of S-LCD, a joint venture with Sony to make LCDs. The South Korean company forecast that prices could fall by as much as 20% in the second half of the year because of increased competition.
"We expect prices for smaller-sized panels (14-15in) to fall 10% and the larger ones (17-19in) to fall as much as 20% in the second half," said Cho Yong-duk, vice-president of Samsung's LCD division, forecasting a price recovery from September.
Lovelacemedia | 16.07.2004