LCD price-fixing probe widens

Seoul: Shares of South Korean LCD panel maker LG.Philips fell sharply to a record low as a three-country probe into price fixing claims spread to more screen producers.

Japan's Fair Trading Commission confirmed that it was investigating price fixing claims against LG.Philips and rivals including Korea's Samsung Electronics Co. Ltd. and Sharp Corp of Japan.

On Monday, LG.Philips said the US Justice Department and the Korean Fair Trade Commission (KFTC) were also looking into the industry.

A joint venture between Japan's Seiko Epson Corp. and Sanyo Electric Co Ltd , which specialises in small liquid crystal display (LCD) screens for mobile phones and digital cameras, is part of the investigations.

According to one media report, the probes could be focused on prices that were in place several years ago.

A public relations official at Taiwan's AU Optronics Corp, the world's third-largest LCD maker, confirmed late yesterday that the company was also under investigation from US authorities.

LG.Philips share ended down 4.26 per centto 25,850 won after dropping as much as 7 per cent to a record low 24,950 won. The group is already under pressure after two straight quarters of losses.

"The news of the anti-trust investigation came on top of market concerns that LG.Philips' net loss would be even wider than expected," said Kim Seong-ki, chief investment officer at SH Asset Management.

"We expect LG.Philips to keep losing money at least throughout the first half. We maintain our 'underweight' rating on the stock."

Shares in Samsung Electronics, whose LCD unit accounted for less than 10 per centof operating profit in the third quarter, dropped only 0.66 per cent, about in line with the broader market.

News that the Japanese firms were being investigated came after the Tokyo market had closed.

LG.Philips, a joint venture between LG Electronics and Dutch Philips Electronics, vowed to fully cooperate with authorities, as did Samsung.