A recent report by Reuters claimed that the deal would take affect as early as this quarter with LG set to supply 2 million units to Samsung next year, and boost shipments to 3 million and 5 million units in subsequent years.
The first units would likely be 77-inch and 83-inch white OLED (WOLED) TV panels, the report said. The deal could lead to Samsung becoming the second largest supplier of OLED TVs globally ahead of Sony.
It would also help LG which has been losing money because of the global downturn, which has weakened demand for electronics. According to Reuters, LG has been running its OLED factory below full capacity.
If the details of the Samsung deal are correct, then analysts said that shipments of 2 million OLED panels would likely be worth at least $1.5 billion to LG, helping to push it back into the black and amounting to around 20-30 percent of its total manufacturing capacity, taking its OLED factory back to full capacity.
"LG's production rate will improve and is likely to reach full capacity next year, helping it lay the groundwork to return to profit," said Jeff Kim, an analyst at KB Securities told Reuters.