Carlyle in $560 milion buyout of Japan LCD venture

TOKYO (Reuters) - U.S. private equity firm The Carlyle Group will lead a 58.1 billion yen ($560 million) management buyout of an LCD glass venture jointly owned by Japan's Hoya Corp and Nippon Sheet Glass, Hoya said on Friday.

Under the agreement, Nippon Sheet Glass would unload its 50 percent stake in the venture, NH Techno Glass Corp, to a special-purpose vehicle set up by Carlyle for 40.6 billion yen, while Hoya would sell a 21.5 percent stake for 17.5 billion yen.

The vehicle would merge with NH Techno Glass in late September, resulting in Hoya holding 47.4 percent in the new entity. Carlyle would hold 52.6 percent, Hoya said.

Reuters reported in late-February that Carlyle was the preferred bidder for the glass venture.

NH Techno Glass faces increasing price competition from bigger rivals, who can invest in new equipment and benefit from economies of scale.

Carlyle and Hoya plan to expand the venture's manufacturing facilities overseas and aim for an initial public offering, the two said in a release.

Hoya said it would book a special profit of 10.4 billion yen in the April-June quarter on the sale of the stake, while Nippon Sheet Glass would book a 25 billion yen special profit on a consolidated basis in the year started April.

NH Techno Glass competes with Corning Inc, Asahi Glass Co Ltd and Nippon Electric Glass Co Ltd which together dominate the market for glass used to make LCD panels.

($1=103.75 yen)

(Reporting by Mayumi Negishi; Editing by Brent Kininmont)