Philips selling $1 billion stake in LG Display

HONG KONG (Reuters) - Dutch electronics giant Philips (PHG.AS: Quote, Profile, Research, Stock Buzz) continued to offload stock in its South Korean flat screen joint venture on Wednesday, selling about $1 billion worth of shares in LG Display (034220.KS: Quote, Profile, Research, Stock Buzz) (LPL.N: Quote, Profile, Research, Stock Buzz) at a discount of 4.8 to 8.1 percent, a term sheet said.

Philips was selling 23 million ordinary shares, or 6.32 percent of LG Display, at a range of 42,750-44,250 won per share in a deal handled by Citigroup (C.N: Quote, Profile, Research, Stock Buzz) and Credit Suisse (CSGN.VX: Quote, Profile, Research, Stock Buzz), the term sheet said.

The deal would reduce Philips' holding in the company, formerly known as LG.Philips LCD, to 13.5 percent from 19.9 percent, while South Korea's LG Electronics Inc (066570.KS: Quote, Profile, Research, Stock Buzz) holds 37.9 percent.

On overallotment option would increase the size of the sale by 25 percent, lifting the value of the deal to about $1.29 billion.

"It's not a great time to sell shares. The current prices are down about 20 percent from the peak seen in November. Almost all analysts, including me, expect LG Display earnings to start increasing after the first quarter, which will mark the bottom in earnings, so there's more room for shares to gain," said Jay Yoo, an analyst at Korea Investment and Securities.

LG Display's stock is down 6 percent since the start of the year but has rallied 22 percent since a low at the start of February on a brightening outlook for LCD demand.

"There's been quite strong demand for LCDs. Seasonally, the first half tends to be more difficult, but demand should pick up by the second half," Yoo added.

In October, Philips unloaded a $2.2 billion holding in the joint venture, the world's No.2 maker of LCDs behind Samsung Electronics (005930.KS: Quote, Profile, Research, Stock Buzz), and LG Display had been looking for a strategic buyer to take up the Philips stake.

(US$=971 won)

(Reporting by Tony Munroe and Rafael Nam; Editing by Anne Marie Roantree)