S.Korea's Iljin Group halts sale of its display maker

South Korea’s Iljin Display Co. has suspended procedures of selling its 43.19% stake with management rights, the junior bourse Kosdaq-listed display maker said in a regulatory filing on Nov. 15. 

Its parent Iljin Group has attempted the sale of the stake, jointly owned by group founder and Chairman Huh Chin-kyu and affiliates, since August and contacted potential buyers including corporate and private equity firms. Iljin group has reportedly scrapped the sale plan as it couldn’t find anyone willing to close the deal, which had been estimated at around 100 billion won ($75.4 million).

The display arm’s major products are touch panels used for smart devices, which account for around 80% of the company’s annual sales. The display producer also makes sapphire ingots and wafers, core materials for light-emitting diodes (LEDs), and is developing flexible displays and 3D touch solutions as new businesses.

Ijin Display has suffered losses for the past three years as price competition with Chinese peers intensified. According to its financial disclosure, it posted an operating loss of 30.8 billion won in 2019. In 2020 and 2021, it had 30.5 billion won and 35.4 billion won losses, respectively.  

It swung to an operating profit of 700 million won during the January-March quarter of this year, with 43.2 billion won in sales, as it reduced expenses with some production lines transferred from Korea to Vietnamese.

Iljin Display is the group’s only affiliate in which Chairman Huh remains a key shareholder. The chairman, who turns 82 in December, is said to plan to step down from management of the group.

He completed management succession in 2013 to his eldest son Huh Jung-suk, vice chairman of Iljin Holdings Co., and second-eldest son Huh Jae-myeong, CEO of battery materials maker Iljin Materials Co., which Korea’s Lotte Chemical Corp. is set to acquire.

Write to Jun-Ho Cha at chacha@hankyung.com
Jihyun Kim edited this article.