Hitachi and Matsushita LCD Pact Finalized, Details Revealed

Matsushita grabs a 24.9% stake in Hitachi Displays

The LCD industry is set to boom in 2008 pushed by the transition to digital TV broadcasts in the U.S. in 2009 and the upcoming Olympic games. This boom in 2008 could lead to a downturn in the coming years according to some experts after LCD makers scramble to ramp up production capacity to meet the current demand for LCD TVs.

Hitachi and Matsushita announced today that the formal contract regarding an alliance has been completed (PDF). A basic agreement between Hitachi and Matsushita was reached in December of 2007.

The final terms of the agreement between the companies was announced today and under the agreement Matsushita will take a 24.9% stake in Hitachi Displays Ltd. Matsushita’s stake will be acquired form Hitachi on March 21, 2008 pending regulatory approvals. A second step of the agreement will have Matsushita purchasing the total shares of IPS Alpha Technology, Ltd. for 66 billion yen along with all IPS LCD panel-related businesses.

DailyTech reported that Hitachi was in talks with Canon in December of 2007 and reports say that the two companies are still working towards a finalized contract. The Matsushita agreement will reportedly leave Hitachi is a 50.2% stake in Hitachi Displays.

The first multi-billion dollar LCD panel talks between Matsushita and Hitachi ensued on December 19, 2007. At that time Matsushita said it would invest $2.7 billion USD into a new LCD manufacturing facility.