Wonik IPS will acquire parts of the display business of Semes, the equipment subsidiary of Samsung Electronics, for 82 billion won, the company announced.
The two have signed a binding MOU for the deal, Wonik IPS said.
Wonik is aiming to buy Semes’ display photo and wet equipment technology, sales right and personnel.
Specific details of the deal is still being ironed out, the company said.
Semes has etcher, stripper, various cleaning equipment, coater and printing equipment in its photo and wet portfolio.
The size of the deal, 82 billion won, is equivalent to 9.1% of Wonik IPS’s total reported assets for last year. The amount is subject to change, the company said.
Semes is offloading most of its display equipment business through the deal. It will only keep ink jet printing equipment used for color filters and organic light emitting diode patterning and encapsulation processes.
Semes’ decision to end most of its display equipment business was likely affected by Samsung Display’s decision to end its Liquid Crystal Display (LCD) business.
Display equipment business has for the past couple years accounted for little of Semes’ sales. In the first quarter, the business only accounted for 5.1% of its quarterly sales. In the quarter, its display equipment factory was only operating at a rate of 33%. There was likely no new orders from customers during the quarter.
Besides Samsung Display, Semes has also sold its equipment to Chinese display companies such as CEC Panda, CSOT and HKC in the past but the volume was relatively smaller.
Semes has met multiple companies to sell its display equipment business since earlier this year. KC Tech was one such company which wanted the business as it could have potentially given it a chance to start supplying to Samsung Display again but the talks failed due to difference of opinion on price.
Semes also negotiated with another company which was founded by an ex-Semes employee but this talk also failed due to difference of opinion on price.
Wonik said it will expand its portfolio through the acquisition and increase the competence of its display business going forward.