Hitachi, Sony and Toshiba have agreed to merger their small and medium-sized display businesses in a new company. They will work with the Innovation Network Corporation of Japan, a government company set up in 2009 to support technology development in Japan. The companies signed a non-binding memorandum of understanding to integrate their display businesses in a new company to be established and operated by INCJ. They aim to sign a definitive agreement in the autumn and complete the merger by spring 2012. INCJ will invest JPY 200 billion in the new company in exchange for shares in the venture. Eventually, INCJ expects to hold 70 percent of the shares with voting rights in the new company, while Hitachi, Sony and Toshiba will each have a 10 percent stake. The merger is expected to create a Japanese leader in the growing sector for small displays for smartphones and tablets. The new company will invest in next-generation production and development, including research on higher resolution and thinner OLED displays. INCJ will lead the process of finding new management for the company, and each shareholder will appoint outside directors to the company and provide technical support.
