Canon Inc. to buy the stake of Toshiba in their joint venture

Friday, January 12, 2007

The offices of Canon Inc. in San Jose, California.

Canon Inc. announced the initiative to start production of new generation flat-panel television on its own. The sole production will occur after Canon Inc. buys the stake of Toshiba Corp. in their joint venture, SED Inc.

The companies are expected to make an official statement concerning their joint venture.

In order to start production of the new flat-screens based on the SED technology, Canon Inc. had to clarify the situation with the Texas-based Nano-Proprietary Inc. The latter has brought a lawsuit against Canon in 2005 on the basis of the two sided agreement concerning the patent on SED technology. The agreement didn't allow Canon to make any other ventures on this technology, but Canon joining forces with Toshiba was the reason for the mentioned lawsuit.

The dispute with Nano-Proprietary was the ground for Canon and Toshiba to delay the construction of the $1.7 billion plant for SED-based flat-panels. Earlier the companies agreed to contribute with 100 billion yen each in the SED plant.

Toshiba's stake in the joint venture SED Inc. is about Yen$10 billion, or, approximately, US$83 million.

This new SED (surface-conduction electron-emitter display) technology is meant to replace the existing LCD and plasma screen due to their smaller sizes and lower energy consumption. At the end of this year the companies planned to start mass production of these new displays.