The first- and third-largest South Korean handset manufacturers make deal to strengthen partnership
Samsung announced today that it is acquiring a 10-percent stake in rival handset maker Pantech, one that will set the worlds largest handset manufacturer back a mere $47.6 million. While known more for making lower-end and spec devices for carriers here in the states, Pantech is actually quite a large company and the number three seller of handsets in its native South Korea. But this deal is likely less about taking a position in a smaller rival company and more about furthering a partnership for handset components that has already been established.
Like many large companies, Samsung and Pantech alike make many of the components needed for handsets on their own to reduce costs. For everything else, they need to buy from an outside source and in this case, Samsung and Pantech already have a standing partnership in both semiconductors and display technologies that will grow with this new investment. If Samsung plans to continue buying and selling components with Pantech, a small investment like this makes sense for such a large company.