LG Chem Ltd. has sold off its optically clear adhesive (OCA) business to a Chinese investment company as part of its plan to exit the LCD market amid intensifying competition from cheap Chinese products.

The Korean chemical manufacturer recently sold its OCA business to Genzon Investment Group Co. for about 60 billion won ($51 million), according to industry sources on Thursday. OCA is an optically transparent adhesive film used on display devices and touch screen panels to bind optical materials to a primary sensor unit.

On Friday, LG Chem shares ended 0.13 percent higher at 761,000 won in Seoul.

The company acquired the OCA business from its affiliate LX Hausys Ltd (formerly LG Hausys) in 2016 at 80.5 billion won. OCA division that generated 200 billion won in annual sales at heyday plunged due to fierce competition from smaller Chinese rivals, said an industry expert.

The OCA no longer is of service to LG Display since it has migrated to OLED as its mainstay panel.

In line with the panel migration, LG Chem has also been moving away from materials serving LCD since 2019. The chemical company sold off its LCD color filter light-emitting material business, including manufacturing facilities in Korea and intellectual properties, to a Chinese company for 58 billion won in February.

It also decided to fold glass substrates business in March after failing to find a buyer.

LG Chem is focusing its resources on growing electric vehicle battery and OLED materials businesses.

The company in July announced eco-friendly, battery materials and life science businesses as three areas for new growth drivers. It plans to invest 10 trillion won in the three sectors by 2025, with 6 trillion won to be spent for separator and other key battery materials.

By Kang Doo-soon, Won Ho-seop, Park Chang-young and Cho Jeehyun

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