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Eastman Kodak Co. and Sanyo Electric Co., Ltd. announced the formation of a global joint venture, the SK Display Corp., to manufacture organic light emitting diode (OLED) displays for consumer devices such as cameras, PDAs, and portable entertainment machines. This represents the next step in the companies' joint development of OLED technology: the manufacture and sale of active-matrix OLED displays. Beginning with a pilot facility in early 2002 and graduating to a full production facility in early 2003, the SK Display Corp. will offer the world's first full-scale manufacturing facility dedicated to full-color, active-matrix OLED displays.

The market for OLED displays, a key product line within Kodak's newly formed Components Group, is expected to range from $900 million to $3.6 billion by 2005, according to Stanford Resources and DisplaySearch. Demand for these displays is being driven by the growing consumer interest in hand-held electronics and the superior performance of OLED over the liquid crystal technology now in widespread use. OLEDs are brighter, thinner and more colorful than LCDs, provide an unlimited viewing angle and consume less power.

"This joint venture with Sanyo is a classic example of how Kodak will leverage its intellectual property to establish high-growth markets that represent significant new business opportunities for the company," said Daniel A. Carp, Kodak's chairman and chief executive officer. "By bringing to consumers the best display technology available, we expect to generate $500 million in OLED display sales by 2005."

Under the key terms of the $350 million joint venture:

* Kodak will hold a 34% stake in the company and make available its OLED manufacturing technology and an unmatched OLED patent portfolio. Kodak will commit about $125 million in cash and loan guarantees over the next two years.

* Sanyo will hold a 66% stake and make available its leading low-temperature polysilicon thin-film transfer (TFT) technology and manufacturing capabilities. SANYO will commit about $225 million in cash and loan guarantees.

* Manufacturing will be based at a new plant in Japan dedicated to active-matrix OLED displays.

* Each company will market and sell the displays.

This joint venture is one more way Kodak is participating in the $225 billion infoimaging industry, formed by the convergence of imaging and information technology. With OLED displays, electronic devices will fulfill their promise to provide consumers rich visual information and entertainment. "Combining Kodak's and Sanyo's technologies, intellectual property, and manufacturing capabilities extends our formidable lead in meeting market demand for active-matrix OLED displays," Carp said.

Satoshi Iue, chairman and chief executive officer of Sanyo Electric Co, Ltd. said, "The rapid development of digital technology and the growing demand for video-enabled IT devices require a new type of display. By capitalizing on the strengths of Sanyo and Kodak in OLED development, we will solidify our position as the leader in the market for OLED displays, which are superior for use in next generation multimedia devices."

OLED displays consist of self-luminous pixels, which do not require the power-consuming backlights used in LCDs. With its performance and design advantages, OLED technology will enable a new generation of display devices, such as digital cameras, mobile phones and PDAs. These devices will offer clearer images and crisper video, as well as thinner designs than similar products with LCDs.

The SK Display Corp. will begin production of displays ranging in size from one to six inches in early 2002. The venture combines Sanyo's technology in fabricating driver circuits on a glass substrate with Kodak's OLED material and device technologies.

This joint venture agreement extends the February 1999 joint development agreement under which Kodak and Sanyo successfully developed the world's first active-matrix full-color OLED displays: a 2.4-inch model in September 1999 followed by 5.5-inch displays in May 2000. This technology can also be extended to produce large displays for personal computers and other devices as the market develops.

Wed Dec 05 09:23:00 CST 2001

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