LG Display to raise $1 billion to ramp up OLED module line in Vietnam

LG Display Co., a major South Korean display panel maker, said on Wednesday it is raising $1 billion in new funding from global banks to expand its organic light-emitting diode module line and build up infrastructure at its Vietnam plant.

The fund will come from the Australia and New Zealand Banking Group (ANZ), HSBC, Citi Bank and Spain’s Caixa Bank with guarantees from the Export-Import Bank of Korea and Korea Trade Insurance Corp.

The Export-Import Bank of Korea will also provide direct loans to LG Display.

The company’s plant in Hai Phong, an industrial port in northeastern Vietnam, assembles OLED panel modules.

“Despite uncertainty over interest rate hikes and the war in Ukraine, global financial institutions have participated in the funding scheme, which proves LG’s OLED expertise and growth potential,” it said in a statement.

The display maker said it will use the money to strengthen its competitiveness in the smaller OLED panel market.

LG is already the world’s top OLED player in large-size panels for TVs, but a distant No. 2 in the smaller OLED market for smartphones and other mobile devices.

According to market tracker Omdia, LG Display controlled 99.7% of the OLED TV panel market in 2021, while crosstown rival Samsung Display Co. had the remaining 3%.

DISTANT SECOND IN SMALL OLED MARKET

In the small and mid-size OLED panel market, Samsung had a 73% market share, while LG controlled 12%.

Last year, LG Display said it will spend 3.3 trillion won ($2.6 billion) on expanding and upgrading small OLED facilities at its plant in Paju, Gyeonggi Province by 2024.

Korean display makers are shifting their focus to OLED panels, in which they have a competitive edge over Chinese companies in terms of manufacturing technology.

LG Display said in early May that it will drastically cut production of its liquid crystal display (LCD) panels for TVs.

OLED is highlighted by self-illuminating pixels that do not require a separate light source, allowing manufacturers to produce lightweight, thin and flexible display products, appealing to high-end consumers.

Write to Ji-Eun Jeong at jeong@hankyung.com
In-Soo Nam edited this article.