Sony Corporation (“Sony”) announced that Sony, Sony Mobile Display Corporation (“SMD”), a 100% subsidiary of Sony, and KYOCERA Corporation (“KYOCERA”) have executed a definitive agreement for the transfer of small- and medium-sized TFT liquid crystal display (“LCD”) design and manufacturing operations at the Yasu Plant of SMD to KYOCERA.
The transfer is planned to become effective on June 1, 2010, subject to receipt of any necessary government approvals.
Sony and SMD plan to increase efficiency and strengthen operations in the small- and medium-sized TFT LCD business by concentrating manufacturing operations going forward in SMD’s Higashiura Plant and SMD’s Tottori Plant* (to be established on April 1, 2010.) By producing a wide range of technically advanced and cost-effective products, and offering comprehensive product lineups that fully utilize its strengths in small- and medium-sized TFT LCD sales, engineering and product design, Sony aims to enhance its customer relationships and strengthen the competitiveness of its small- and medium-sized TFT LCD business to continue to meet and exceed customer needs.
1. The outline of the agreement
(1) Assets to be Transferred
Equipment and other assets relating to small- and medium-sized TFT LCD design and manufacturing operations at SMD’s Yasu Plant.
Existing employment agreements are planned to be assigned to KYOCERA on June 1, 2010 and the employees of the design and manufacturing operations will be transferred to KYOCERA.
2. Impact on Financial Results
Although an impairment loss on the fixed assets has been incurred by Sony in connection with the transaction, no material impact is anticipated on Sony’s consolidated financial results forecast for the current fiscal year announced on February 4, 2010 as such loss has been included in the forecast as a part of the 130 billion yen of restructuring charges.
SMD’s Yasu Plant
Location: 800 Ichimiyake, Yasu-City, Shiga Prefecture
Operations: Design and manufacturing of TFT LCD display devices and related parts
* SMD’s Tottori Plant
SMD plans to acquire certain business assets of Epson Imaging Device Corporation at its Tottori Plant and to establish SMD’s new Tottori Plant on April 1, 2010, as explained in Sony’s announcement dated June 30, 2009, titled, “Agreement to Transfer to Sony Certain Epson Business Assets Relating to Small- and Medium-Sized TFT Liquid Crystal Display Operations.”