Japanese multinationals NEC Corporation and Sharp Corporation have announced a joint venture to combine their display specialities to mount a response to the increasingly challenging display market.
Under the collaboration, NEC will transfer 66 percent of the ownership of its display division, NEC Display Solutions (NDS), to Sharp and retain 34 percent equity in the venture.
Seen as a response to the growing competition in both volume and affordability from Chinese display panel manufacturers - China’s BOE is now the biggest flat panel display manufacturer in the world having overtaken LG Display last year - the consolidation will allow the two Japanese firms to jointly build on their relative strengths and expertise as they look to push into North America and Europe.
NDS is recognised as a leading provider of visual technology including LCD displays, projectors, digital cinema products and digital signage while Sharp’s innovations centre around business products, including professional and commercial displays, and advanced technologies like next generation 8K Ultra High Definition monitors.
In 2019, Futuresource’s Worldwide Quarterly Tracking Services cited the two companies as having a combined volume share of 7.5 per cent in the LCD market, and 5.1 per cent in the projector market.
The combination of this pool of expertise will be more customer focussed, bring together the companies’ existing portfolios as well as encourage expansion to more buyers in new areas of display technology such as 5G + 8K due to the benefits of scale and cross-selling.
Fujikazu Nakayama, Senior Executive Managing Officer, Sharp Corporation and BU President, Business Solutions BU explained, “The combination of Sharp’s and NDS’ international strengths is mutually complementary. We expect this agreement to result in a wide range of synergies, including economies of scale and business expansion in new categories, including an 8K+5G Ecosystem.” He added, “Sharp believes that developing NDS as a joint venture with NEC will contribute to our business growth by enforcing our BtoB business and expanding sales.”
The joint venture will allow NEC to continue to sell NEC branded products as well as the joint venture’s products and solutions to its customers around the world. The transfer is scheduled to be concluded on July 1st, 2020.