A press release went out yesterday saying Samsung Display has acquired a 7.4% stake in the organization in return for giving Corning full charge of the Samsung Corning Precision Materials partnership. Corning also stated the two companies have joined right into a "new lengthy-term Liquid crystal display glass supply agreement" which will last through 2023.
Corning's Gorilla Glass is an essential component of numerous mobile phones because it provides both lightweight and sturdiness that producers search for once they build flagship products.
CORNING, N.Y., October 22, 2013 - Corning Incorporated (NYSE: GLW) announced today that it is entering into a series of strategic and financial agreements with Samsung Display Co., Ltd., intended to strengthen product and technology collaborations between the two companies. These agreements will allow Corning to extend its leadership in specialty glass and drive earnings growth. Corning expects the transactions to close in the first quarter of 2014.
The series of transactions, subject to closing conditions being met, will result in:
- Corning obtaining full ownership of Samsung Corning Precision Materials Co., Ltd. (SCP), an unconsolidated equity venture with Samsung Display that manufactures LCD glass in Korea. Samsung Display currently owns 43% of SCP.
- After redemption of their interest in SCP, Samsung Display's investment in new convertible preferred shares of Corning with an aggregate face amount of $1.9 billion.
- Corning's acquisition of the other shareholders' minority interests in SCP for an expected proportional cash payment.
- Samsung Display's additional $400 million investment in Corning by subscribing to new convertible preferred shares.
- Using Corning's current share count, Samsung Display's combined investment in Corning would result in approximately 7.4% ownership on an as-converted basis.