LG Display Declines After Reports of Prosecutors’ Raid
LG Display Co. (034220), the world’s second- largest flat-panel maker, fell the most in more than seven months in Seoul trading after local media reported that prosecutors searched its headquarters in relation to a competitor’s display technologies.
LG Display dropped 6.6 percent to 23,500 won at the close, the biggest decline since Sept. 23, while Korea’s benchmark Kospi index slipped 0.2 percent.
South Korean prosecutors checked LG Display’s Seoul headquarters on April 26 to probe whether the company illegally obtained organic light-emitting-diode technologies from Samsung Mobile Display Co., media including Korea Economic Daily, Asia Economy Daily and Edaily reported today. Claire Ohm, an LG Display spokeswoman, declined to comment, and a spokesman at the prosecutors’ office wasn’t immediately available to comment.
“The stock is falling mostly because of the prosecutor issues,” Hwang Joon Ho, a Seoul-based analyst at Daewoo Securities, said by telephone. “It’s hurting investor sentiment.”
Police are questioning current and former employees of both companies over allegations that Samsung Mobile workers leaked OLED technologies to LG Display, according to Edaily, which cited unidentified people at the prosecutors’ office and from the industry.
“It’s an illegal activity by a competitor to steal our technologies,” Jun Eun Sun, a spokeswoman for Samsung Mobile Display, said by phone. “We hope their criminal activity is clearly exposed through prosecutors’ investigation.”
She didn’t elaborate.
LG Display and Samsung Mobile, the unit of Samsung Electronics Co. (005930) that makes screens for mobile devices, are competing for leadership in OLED panels for televisions.
LG Electronics Inc., the parent of LG Display, and Samsung Electronics both plan to start selling OLED TVs this year that can be as thin as 4 millimeters (0.16 inches) and produce sharper images than liquid-crystal-display sets.
LG Display reached a settlement with eight U.S. states and consumers over claims that it colluded with other LCD makers to fix prices, the company said April 30. The settlement may also be negative for LG Display since its costs may rise, Hwang said.
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