Jo Seong-jin, CEO of LG Electronics, announced on March 26 that the company is seeking investment opportunities in adjacent industries, revealing plans for mergers and acquisitions.
During the regular general shareholders’ meeting held at the LG Twin Towers in Yeouido, Seoul, CEO Jo stated, “After announcing our ‘2030 Future Vision’ last year, we disclosed our plan to invest 50 trillion won to transform our portfolio. We will create opportunities by increasing capital investments such as joint ventures, equity investments, and M&As.”
In a meeting with reporters following the shareholders’ meeting, CEO Jo mentioned that the investment areas would include platforms and business-to-business (B2B) transactions, which are considered as new growth engines for the company.
LG Electronics unveiled its mid-to-long term strategic direction on the same day. CEO Jo introduced plans to transition into a “Smart Life Solutions Company,” moving away from being a hardware-centric appliance manufacturer to focusing on platform-based services, automotive components and air conditioning systems in B2B, and new businesses such as electric vehicle charging and the metaverse.
LG Electronics sells over 100 million smart devices annually, and considering a product life cycle of 7 years, approximately 700 million devices are in use worldwide. The company plans to convert these into a platform, transitioning to intangible businesses such as content services and subscription solutions to generate revenue. Beyond TVs, LG Electronics is expanding the application of its webOS to smart monitors and automobiles.
The vehicle component sector is planned to grow into a 20 trillion won business by 2030, with infotainment, electric vehicle power, and intelligent lamps as the three main pillars.
In the electric vehicle charging market, the company is preparing beyond charger distribution to total complex charging stations and robot-linked charging. Moreover, based on the global customer base, network, and synergy with affiliates secured through its existing B2B business, LG Electronics plans to grow its electric vehicle charger business to the scale of tens of billions of won within five years.
In the extended reality (XR) and metaverse domains, LG is exploring collaborations with global big tech companies, including Meta. At the end of last month, CEO Jo and LG’s management team discussed collaboration during a meeting with Meta CEO Mark Zuckerberg, who was visiting Korea. At the shareholders’ meeting, CEO Jo explained, “Combining LG’s TV content capabilities with Meta’s platform completes the connection between platform, content, and device. We discussed securing leadership in future virtual spaces by exploring our synergies.” According to the company, besides Meta, several global big tech firms are seeking partnerships with LG Electronics to embed AI in their devices.
LG Electronics also announced a new shareholder return policy for the next three years, increasing its dividend payout ratio from 20% to 25%, a 5 percentage point increase. The company will increase the dividend frequency from once to twice a year and has set a minimum dividend of 1,000 won.