Samsung-Logo-AH8

China Buying Korean Firms that Partner with Samsung

December 16, 2015 - Written By Alexander Maxham

Smartphone makers have several partners that supply parts for their products. While Samsung does make a number of the parts themselves, they do still outsource a lot of the parts to make things easier and faster. Samsung has a number of partners in Korea, last count was around 500 firms. LG has about 500 as well, while SK Hynix has around 1500. It’s reported that Samsung is facing a bit of an issue where several LCD and semiconductor manufacturing companies in China are looking to acquire Korean firms. LG and SK Hynix are also facing this issue. BOE, who is one of the larger display panel makers in China, had made an offer to Korean driver IC design firm. They weren’t successful in buying the company, but they did get a supply contract out of the deal. BOE is also interested in acquiring fabless semiconductor companies, according to this report.

 

It’s also being reported that Chinese firms are looking to do business or acquire Korean brands by investing pretty aggressively in these brands, offering them a number they can’t refuse. And having the biggest economy, China is able to do just that.  Currently, the Hualian Group is bidding on Faichild Semiconductor. This company does have a semiconductor plant in Bucheon City. And analysts are saying that with the increase in the number of Korean firms being bought by China, this could pose a big threat to Samsung and their supply chain. As South Korea and China aren’t exactly on the same page. We’ll have to see how all of this plays out though.

Samsung has a number of partners, and this could force the company to look elsewhere for components for their smartphones, tablets, smartwatches and other products. Which may not be a bad thing, change is usually a good thing. Right now, China has the largest mobile market in the world, with India in second and looking to overtake China in the next few years. China wants to keep that market to just home-grown companies like Xiaomi, Huawei, Meizu, and a few others. And to squeeze out the foreign companies like Samsung.