LG seeking to acquire healthcare firm
By Kim Yoo-chul
LG Electronics is looking to acquire a firm in healthcare-related fields, a company official said Wednesday.
``LG’s top executives have reached a consensus for the necessity of acquisition deals for new profit sources. The target will be in the healthcare business,’’ said the source, asking not to be named.
LG is trying to inject more resources to diversify its business portfolios amid competition with its rivals in the intensive consumer electronics market.
Water and air purifiers, which are more like business-to-consumer (B2C) products, are one of the key priorities for LG. In contrast, Samsung is focusing more on business-to-business (B2B)-linked healthcare businesses such as medical equipment.
An LG Electronics spokesman said an acquisition deal is one option for external growth in its home appliance businesses.
``Mergers and acquisitions (M&A) might be a possibility as mid- and long-term strategies to strengthen LG’s home appliance businesses,’’ added the spokesman without elaborating further.
The plan comes after LG is releasing its strategic healthcare items outside the peninsula. It just introduced water purifiers in India after air purifiers it released there in 2008.
LG said the Indian water purifier market is one place that LG should not lose, along with North America and China. LG sees the market size in that segment, will grow to over $300 million there.
In the local market, LG has seeing sales increase of its water purifiers and massaging-chairs as part of its ``healthcare initiatives’’ under the asking of its new CEO Koo Bon-joon.
The chief of its home appliance division Lee Young-ha recently said he is keen to link new businesses to medical-related ones.
LG unveiled a fridge that can suggest recipes based on the food inside because it expects a lucrative future in the market for ``smart’’ appliances.
It is set to roll-out smart refrigerators, washers and other household appliances, domestically and in North America by the end of the year with an aim to better compete against Whirlpool.
LG’s first smart gadget, a refrigerator connected to a home Wi-Fi network, that can be controlled by smartphone, is providing three energy-saving options as well as a ``food management system.’’
The system tells buyers what’s in their fridge, where it is and when its sell-by date expires.
The global market for smart home appliances will open from early 2013 and reach $26.1 billion in sales by 2019.
LG previously failed to receive favorable responses with a refrigerator connected to the Internet years ago.
``That’s the story about the past. Now, with Wi-Fi networks everywhere, smartphones are proliferating and prices are becoming more affordable,’’ said Lee of LG.