BRUSSELS, Sept 23 Japanese electronics giant Sony Corp (6758.T) won European Union regulatory approval on Wednesday to acquire part of Seiko Epson Corp's (6724.T) small and medium-sized LCD business.
The deal, unveiled in June, would enable Sony to acquire the loss-making small and medium-sized LCD operations of Seiko Epson by April 2010 for free, a move aimed at boosting Sony's competitiveness as a display maker.
The European Commission, competition watchdog of the 27-country EU, said in a statement that the transaction would not impede competition in the European market.
"Sony's acquisition of control over the Epson business would not raise any horizontal or vertical competition concerns under any possible market definition," the Commission said.
"Furthermore, Sony's competitive behaviour will be constrained by a number of strong and effective competitors and many large and sophisticated customers," it added.
The panel assets that will be transferred to Sony include output facilities for amorphous silicon thin-film transistor (TFT) LCDs, known as low-cost displays, and intellectual property rights for low-temperature polysilicon TFT LCDs, which offer better picture quality.
Sony focuses on low-temperature polysilicon TFT LCDs in the small and medium-sized category, and the addition of amorphous silicon TFT LCDs is expected to strengthen its operations as a panel supplier as well as a maker of mobile devices with displays, such as cellphones and digital cameras.
In a bid to secure cost competitive large-sized panels for its flat TVs, Sony also plans to take a stake in Sharp Corp's (6753.T) new 380 billion yen ($4.2 billion) LCD panel plant in the city of Sakai in western Japan. (Reporting by Bate Felix; Editing by Dale Hudson)