Magnachip to split out power and display businesses
Magnachip Semiconductor is to split its power and display businesses into separate entities by the end of the year.
The move is driven by the collapse of the OLED driver business and current semiconductor downturn, as the power business is growing strongly.
The company has already sold off its largest 200mm fab and foundry business to focus on standard products in power and display drivers.
“This strategic separation represents a significant milestone for Magnachip and underscores the Company’s commitment to unlocking long-term value for our shareholders,” said YJ Kim, CEO of Magnachip.
“The internal separation is aimed at enhancing transparency, accountability and flexibility in business. By establishing distinct entities, we believe our investors will be able to better evaluate the financial performance of each business and their respective contributions. Furthermore, this strategic move will allow each entity to allocate its resources, both financial and technical, more effectively to the specific needs of its customers,” he said.
“Magnachip remains dedicated to delivering innovative solutions and exceptional customer experiences in both the display and power sectors, and we are confident that this separation will strengthen our ability to achieve these objectives by enhancing each business’s agility and focus.”
A new subsidiary (NewCo) with the assets and liabilities of the display business will be set up under Magnachip Semiconductor alongside Magnachip Korea as the company’s operating subsidiary.
Once the Internal Split-Off is completed, Magnachip Korea and NewCo will both be separate operating companies, with NewCo being a wholly owned subsidiary of Magnachip Korea.
The Company’s Gumi fabrication facility will remain with Magnachip Korea as an integral part of its power business.
The Internal Split-Off is expected to be completed in the fourth quarter of 2023.
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