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Corning, makers of the popular Gorilla Glass series, has entered into a ten-year strategic and financial agreement with Samsung Display to “strengthen product and technology collaborations between the two companies.” The deal is expected to close by the first quarter of 2014.
Thanks to this agreement, Corning will obtain full ownership of Samsung Corning Precision Materials Co., Ltd., a company that manufactures LCD glass in Korea. The deal will also see Samsung invest more than $400 million in Corning by subscribing to its preferred shares, in return for which, the company will get $1.9 billion worth of convertible shares for a 7.4% stake in Corning.
“We are excited to enter this new era of collaboration in our 40-year equity relationship with Samsung, one of the world leaders in consumer electronics,” Wendell P. Weeks, chairman, chief executive officer and president, said. “The agreements provide important financial and strategic benefits to both Corning and Samsung.”
The deal also includes a 10-year LCD display glass supply between Corning and Samsung, adding an additional $2 billion in revenue for Corning every year. The full press release for all the nitty gritty details can be found here.
Other OEMs are already dependent on Samsung for quite a few of the core components of their devices, and this acquisition might just be a worrisome news for them.
