Asahi Glass turns away from cathode ray tubes

Asahi Glass sees its future in flat panel displays and will withdraw from a Chinese joint venture making parts for CRT televisions.
The Japanese glass giant said 21 December 2006 that it will sell it…

Asahi Glass sees its future in flat panel displays and will withdraw from a Chinese joint venture making parts for CRT televisions. The Japanese glass giant said 21 December 2006 that it will sell its entire 40% stake in the Chinese venture making glass for cathode-ray tubes. It will sell the shares in Shanghai Asahi Electronic Glass Co. to Chinese partner SVA Electron Co. “The shift of TV and PC displays from cathode-ray tubes to flat-panel displays is accelerating and demand for cathode-ray tube glass is expected to continue to decrease”, the company said in a statement. It did not disclose the terms of the sale but said the transaction would result in a loss of JPY 10 billion (USD 84.5 million). Due to the withdrawal and separate impairment losses in North America, Asahi Glass cut its 2006 net profit forecasts to JPY 41 billion (USD 346.5 million) from the earlier projection of JPY 76 billion. Under a plan launched in 2005, Asahi Glass has stopped manufacturing glass for conventional television tubes in Japan, Indonesia and Taiwan and cut back in China, Singapore, South Korea and Thailand. The market for flat-screen televisions is growing rapidly: Electronics giant Matsushita Electric Industrial Co., announcing plans earlier in 2006 to build the world“s largest plasma panel plant, predicted the global flat-screen TV market would soar 60% in 2006 to 45 million units.