LG wants to sell its smartphone division: here’s who to

After months of rumors and uninspiring performance, LG is preparing to say goodbye to its smartphones: the confirmation comes from the company as well.

The future of LG in the mobile phone industry has never looked more uncertain than in recent days. After the conflicting information bounced recently among the various newspapers of the country, it was the same South Korean manufacturer to confirm the possible farewell to smartphones in 2021.

It is last week the news of the Korean newspaper The Elec that, in a publication, reported the decision by LG Electronics to put an end to the production of cell phones. Ready came the denial by Ken Hong, Head of Corporate Communications, who did not fail to emphasize that the rumor had no value of truth. In spite of this, there have been rumors about the confirmation of the closure of the mobile sector. Among the rumors, the one published by The Bell, with an article about the intention to restructure the company's structure by putting an end exclusively to the realization of top of the range devices, immediately followed by a news published by the Korea Herald, in which it was reported an internal communication signed by Kwon Bong-sok, CEO of LG Electronics, suggesting the possibility of big changes coming for the smartphone sector.

LG's farewell to smartphones, the words of CEO Kwon Bong-sok

Of course, the loudest voice in the chorus was precisely that of LG's CEO, with a note rather sharp but at the same time able to calm the spirits of part of the company's employees. "Regardless of any change in the direction of smartphone business operations, jobs will be maintained, so there is no reason to worry," Kwon Bong-sok stressed in the message whose veracity was confirmed by LG to the online magazine The Verge.

The intention would then be reiterated on the pages of The Korea Herald by an LG company official, who remained anonymous: "As competition in the global mobile device market is becoming fiercer, it is time for LG to make a cold judgment and make the best choice. The company is considering all possible measures, including the sale, withdrawal and downsizing of the smartphone business."

LG's farewell to smartphones, what does the future hold?"

Despite the company's expressed desire, LG was keen to clarify that this decision would not be taken as final but merely as a guideline for the future. "Management is committed to taking whatever steps are necessary to solve the challenges of the mobile business in 2021," reads the company's recent statement on the matter, but "to date, nothing has been finalized."

For sure, the recent past of LG's signature telephony is not among the rosiest. Over the past five years, the company has posted losses for 23 consecutive quarters, starting with the second quarter of 2015. In an attempt to pull up the company's fortunes, new strategies - such as those related to the Explorer project smartphones - have been implemented by the arrival of Kwon Bong-seok, although we will have to wait until the end of 2021 for a definitive confirmation of the success of the operation.

So, all that remains is to wait patiently to find out what the fate of LG will be, hoping that the next few months can help shed light on the direction they intend to take in the Seoul headquarters.

Who will buy LG's smartphone division

LG's desire to sell its smartphone division finds further clues, if not confirmation, in the fact that the name of the possible buyer is already circulating: according to Business Korea, in fact, the Vietnamese group Vingroup has already made an offer to LG and it would be the best one so far. But not the only one, since there would already be more tables open for the sale.

Vingroup is a conglomerate active in different sectors of the economy, from tourism to cars and entered the smartphone market only in 2018. But it has a combined value at the end of 2020 of $16.5 billion, and that would be enough for it to buy and carry on LG's smartphone business.