UPDATED. 2022-06-30 18:13 (목)
LG Group had refused to handover chip development team to LX Group
LG Group had refused to handover chip development team to LX Group
  • Jang Keyoung Yoon
  • 승인 2022.02.07 14:50
  • 댓글 0
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LX Semicon wanted LG Electronics' chip design team called SIC Center
LG refused as it wants competence in chips to capitalize on future business areas
LG Group chairman Koo Kwang-mo, left, and LX Group chairman Koo Bon-joon Image: LG Corporation
LG Group chairman Koo Kwang-mo, left, and LX Group chairman Koo Bon-joon Image: LG Corporation

LG Group had refused to hand over its chip development team to LX Group, which had split off from the former last year, TheElec has learned.

LX Semicon, formerly called Silicon Works, had made a request during the second half of 2021 to LG Electronics to transfer its personnel and asset under the System Integrated Chip (SIC) Center.

SIC Center, which is under the supervision of LG Electronics’ CTO, develops various system semiconductors such as mobile application processors and SoCs for TVs.

Since last year, following LG Electronics’ exit from the smartphone business, the center had been focusing on developing SoCs for appliances while using TSMC as the contract manufacturer of these chips. Still, the center has the capacity to design mobile application processors and other chips.

LX Semicon CEO Son Bo-ik also previously worked at LG Electronics’ SIC Center.

LX Semicon, which mainly designs display driver ICs, wanted to increase its semiconductor business competence in other areas such as mobile application processors and power management ICs through securing the center, sources said. Display driver ICs account for over 90% of LX Semicon’s current revenue and the company wants to reduce this reliance, they said.

LX Semicon was founded as Silicon Works in 1999 by ex-LG chip engineers. LG Group acquired the firm in 2014. Since the acquisition, the firm had grown exponentially thanks to high demand for its display driver ICs for OLED and liquid crystal display TVs, which are used in LG Electronics' TVs.

In 2015, LX Semicon's annual revenue was 535.8 billion won; in 2020, this increased to 1.16 trillion won, more than double its revenue figure of five years ago. LX Semicon currently has over a thousand employees.

LX Group has been pushing to grow LX Semicon as its flagship subsidiary. The group acquired patents related to semiconductor wafers from LG Innotek as part of this plan. LX Group chairman Koo Bon-joon, which was previously the CEO of LG Semiconductor, has a strong interest in the chip business, the sources said, which is reflected in the group’s request to secure the SIC Center.

However, LG Electronics refused as it believes it needs to maintain its competence in semiconductors through the center to foster future businesses such as autonomous driving, robotics and the so-called metaverse. 

LG Group chairman Koo Kwang-mo, who is the nephew of LX Group chairman Koo Bon-joon, was behind the decision for the refusal, the sources said. The LG Group chairman had effectively flat out refused the request, they said.

In the past, LG Electronics had once considered handing over the SIC Center to Silicon Works, but this plan was scrapped as Silicon Works wasn’t a big enough company to house the center.


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