Bang & Olufsen, LG to partner on OLED TV
The agreement will see Bang & Olufsen focus on its core competencies within design, acoustics and smart home integration within TV development, and combine them with LG’s technological expertise in OLED technology.
“This partnership with LG will enable Bang & Olufsen to stay at the forefront of innovation in the TV category, a category which is currently undergoing significant change and which is very important to Bang & Olufsen. The partnership will address Bang & Olufsen’s key challenges related to scale and complexity,” said Bang & Olufsen CEO Tue Mantoni.
The partnership will help solve a key strategic challenge as Bang & Olufsen will achieve technological capabilities and scale needed to improve the long-term profitability of the company. The partnership will allow Bang & Olufsen to focus on core competencies within acoustics and design, while further optimizing the company’s supply chain, development, production and service.
The first OLED TV produced by LG for Bang & Olufsen as a result of the partnership is expected to be launched in 2017. The partnership involves collaboration in other areas such as license and product bundle activities.
As a consequence of the partnership, Bang & Olufsen expects to improve gross margins and reduce capacity costs. The agreement has an annual savings potential of DKK 150-200m when fully implemented across the next three years.
As a result of the partnership Bang & Olufsen expects to realize restructuring costs of DKK 10m to 15m, of which up to DKK 5m will be realized in the fourth quarter of 2015/16.
Bang & Olufsen: www.bang-olufsen.com
LG Electronics: www.lg.com
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