A JOINT venture between Hon Hai Precision Industry Co., known as Foxconn, and Sharp Corp. plans to build a 61 billion yuan (US$8.8 billion) factory in China to produce liquid-crystal displays (LCDs).

    Sakai Display Products Corp.’s plant will be a so-called Gen-10.5 facility specializing in large-screen LCDs and will be operational by 2019, the company said at a signing event with local officials in Guangzhou on Friday. It said the plant will have capacity equating to 92 billion yuan a year.

    The heavy investment is aimed at increasing production to meet expected rising demand for large-screen televisions and monitors in Asia.

    Global LCD output was hit last year by the closure of a Samsung factory that accounted for 3 percent of the market, as well as factory stoppages in Taiwan after an earthquake in March.

    China’s largest LCD panel maker, BOE Technology Group, began construction on its own Gen-10.5 plant in Hefei in December 2015, with production scheduled to begin in 2018.

    In May Shenzhen China Optoelectronics Technology Co., a subsidiary of TCL Corp., announced that it would begin construction on a 50 billion yuan LCD plant in Shenzhen.

    Sakai Display Products Corp.’s plans for the Guangzhou plant come as Hon Hai seeks to turn the joint venture into a subsidiary, investing a total of 15.1 billion yuan in the company.

    The venture will also sell 436,000 shares for 17.1 billion yuan to an investment co-owned by Hon Hai Chairman Terry Gou, giving Hon Hai a 53 percent interest in the business and lowering Sharp’s stake to 26 percent from 40 percent.

    (SD-Agencies)