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Pioneer To Acquire NEC Plasma Business

2/04/2004 12:33:00 PM Eastern

Tokyo - NEC said it plans to sell its plasma display manufacturing business to Pioneer, in a move that will make Pioneer the world’s largest manufacturer of plasma display panels.

NEC said it had agreed to sell the plasma business to focus on its core operations -- IT networks solutions and semiconductors.

It will retain its Visual Systems Division, which produces plasma panels primarily for commercial markets. Pioneer will manufacturer plasma panels under both the Pioneer and NEC brands.

Reports out of Japan indicated the purchase would cost Pioneer about 40 billion yen, although both companies declined to disclose details.

After the acquisition, Pioneer’s market share of plasma display manufacturing is expected to rise from 14 percent today, as estimated by analysts, to what Pioneer predicts to be 22 percent.

Kaneo Ito, Pioneer president, said the PDP market is expected to nearly double in size each year over the next few years, leaping from 590,000 units last year to 3.5 million in 2006.