Sony to sell LCD venture stake to Samsung for $940m

Sony Corp has agreed to sell its nearly 50 percent stake in an LCD joint venture with Samsung Electronics to the South Korean company for $940 million, as it struggles to reduce huge losses at its TV business.
The seven-year-old venture cut its capital by 15 percent in July and industry sources had said Sony was negotiating an exit, aiming to switch to cheaper outsourcing for flat screens for its TVs while Samsung pushes ahead with next-generation displays.
"In terms of direction it is a positive (for Sony)," said Keita Wakabayashi, an analyst at Mito Securities in Tokyo, about the deal. "But if they are making a loss on the sale, one could ask why they didn't make this decision sooner."
"Their biggest problem is that they are not making a profit even though they don't have many plants," he said.
In November, Sony, the world's third largest flat panel TV maker, warned of a fourth straight year of net losses for the financial year to next March, with its TV unit alone set to lose $2.2 billion on tumbling demand and a surging yen.