Sharp may sell IGZO LCD technology to China’s CEC: sources

Sharp Corp is considering licensing its power-saving IGZO liquid crystal display technology to China Electronics Corp as part of a plan to jointly produce panels in China, two sources familiar with the plan said.

Sharp, which was rescued from failure by its banks in October, is pursuing the partnership to expand low-cost LCD production, the sources said on condition they not be identified.

Sharp will receive several hundreds of millions of dollars in fees for its advanced IGZO technology while investing in a new CEC plant in Nanjing, they added. Sharp will have the right to buy a portion of the plant’s output.

The factory, which has yet to win approval from the Chinese authorities, may start production as early as 2015.

The potential deal with CEC was first reported by Japan’s Nikkei business daily. The paper said CEC planned to invest 300 billion yen (HK$23.8 billion) in the plant, while Sharp would take a less than 10 per cent stake in a joint venture that will operate it.

IGZO, or indium gallium zinc oxide, screen technology developed by Sharp allows for lower power consumption as well as higher resolutions and faster reaction speeds, and is key to the company’s recovery plan after it suffered heavy losses due to excess capacity and weak demand for its TV screens.