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Apple advances $500m in LG deal
Liquid crystals for five years

By Reuters

Published: Tuesday 13 January 2009

South Korea's LG Display said it has signed a deal to supply LCD panels to Apple for five years.

The world's second-biggest maker of LCD screens did not disclose the total size of the deal but said in a filing to the Korea Exchange that it would receive a $500m advance from Apple this month.

A spokesman for LG Display said: "Although LG Display already had a relationship with Apple, the deal's duration and the size of the advance show that the two companies are involved in a long-term, strategic alliance."

Shares in LG Display were up 3.37 per cent, outperforming the wider market's 1.17 per cent drop but analysts were quick to discount the impact of the announcement.

Park Sang-hyun, an analyst at HI Investment & Securities, said: "LG Display's panels already represent more than 70 per cent of Apple's notebooks and monitors."

"The share performance may be due to the fact that the decline in panel prices is not expected to continue," Park said, referring to the steep price drops the LCD industry has experienced this year in the wake of the global slowdown and an industry oversupply.