LG 2001 Annual Report Download - page 90

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ยป90
LG Electronics Inc. The
43
rd Annual Report
Notes to Financial Statements
for the years ended December 31, 2001 and 2000
26.
Establishment of a joint venture related to Cathode Ray Tubes (CRT) business
Pursuant to the resolution by the board of directors on June 11, 2001, the Company established a joint
venture (LG. Philips Displays Holding B.V.) relating to its Cathode Ray Tubes (CRT) business with Koninklijke
Philips Electronics N.V. (Philips) on June 29, 2001. In connection with the joint venture, the Company
contributed its investments in Beijing LG Electronics Components Co., Ltd. (LGEBJ) and LG Shuguang
Electronics Co., Ltd. (LGESG), and assets and liabilities of the CRT business of LG Electronics Wales Ltd.
(LGEWA) and PT LG Electronics Display Devices Indonesia (LGEDI), and cash of US$ 400 million. The
Company also sold assets and liabilities of its CRT business located in Kumi and Changwon to LG. Philips
Displays Korea Co., Ltd., a subsidiary wholly owned by the joint venture, on June 30 2001. As a result, the
Company was paid 1,432, 530 million (US$1,100 million) in cash and paid Philips 73,770 million to
settle the debt transferred to the joint venture.
The Company recognized a gain on business transfer amounting to 1,358,760 million.
Establishment of a joint venture related to Cathode Ray Tubes (CRT) business, Continued :
The book value of assets and liabilities of the CRT business transferred to LG. Philips Displays Korea Co.,
Ltd. is as follows :
Millions of Won
Current assets 287,238
Fixed assets 510,034
Total assets 797,272
Current liabilities 163,249
Fixed liabilities 23,427
Total liabilities 186,676
Net assets 610,596
Information regarding income of the CRT business for the first half period of 2001 is as follows :
Millions of Won
Sales 938,060
Operating profit 121,407
The price is subject to adjustment based on determination of assets and liabilities contributed and
transferred to the joint venture.