Dec. 25 (Bloomberg) -- Matsushita Electric Industrial Co., the world's largest maker of plasma televisions, may buy control of a Hitachi Ltd. unit to increase sales of faster-growing liquid-crystal display sets.

The company may almost double its stake in LCD maker IPS Alpha Technology Ltd. to more than 50 percent, the Osaka-based maker of Panasonic-brand products said in a statement today. Financial terms weren't disclosed.

Matsushita joins LG.Philips LCD Co. in buying shares of display makers to weather a supply shortage that analysts at Lehman Brothers Holdings Inc. and UBS AG estimate will persist next year. LCD TVs are taking market share from plasma by offering brighter images and slimmer models.

``The move will give Matsushita a foothold to expand in LCDs,'' said Hideyuki Suzuki, an analyst at SBI E*Trade Securities Co. in Tokyo. ``There's been a concern with Matsushita because it's focusing on plasma screens at a time when LCD screens are overwhelmingly better.''

Global shipments of LCD TVs will rise 33 percent to 94.7 million units in 2008 as those of plasma sets climb 26 percent to 13.1 million units, according to JPMorgan Chase & Co. estimates this month.

Matsushita shares rose 1.1 percent to close at 2,325 yen on the Tokyo Stock Exchange. Hitachi's stock climbed 3.9 percent to 836 yen, its highest close since Aug. 9.

Largest Shareholder

Hitachi, based in Tokyo, is the largest shareholder in IPS Alpha with a 50 percent stake, followed by Matsushita's 30 percent and Toshiba Corp.'s 15 percent. The venture said in September it plans to raise annual production capacity, in terms of 32-inch panels, at its Mobara plant in Chiba prefecture by 20 percent to 6 million units by the end of September.

Matsushita President Fumio Ohtsubo said at a news briefing today the company plans to buy Toshiba's entire stake in IPS Alpha. The venture will probably build a new LCD factory, worth about 300 billion yen, scheduled to begin operations in the fiscal year that ends in March 2010, he said.

Separately, Matsushita and Canon Inc. said in the statement they will each buy 24.9 percent Hitachi Displays Ltd., which makes smaller LCDs used in mobile phones and cameras, by the end of March. Canon's holdings in the company may increase to a controlling stake, according to the statement.

Organic Displays

Matsushita and Canon expect the investments to help the companies develop new organic light emitting diode displays, according to the statement. Organic panels are brighter, slimmer and consume less energy than LCDs.

The investments add to evidence of a reorganization in Japan's display industry after competition including from South Korea's Samsung Electronics Co. and Taiwan's AU Optronics Corp. drove down prices and profits. Toshiba, Japan's largest chipmaker, said last week it may sell its stake in IPS after agreeing to buy panels from Sharp Corp.

To contact the reporter on this story: Hiroshi Suzuki in Tokyo at hsuzuki5@bloomberg.net.

Last Updated: December 25, 2007 04:40 EST