In the technological battle between Samsung Electronics and LG Electronics, two major players in the Korean electronics industry, robots are quickly emerging as a hot new product.
At the 54th Samsung Electronics regular shareholders’ meeting on March 15, Han Jong-hee, head of the Device Experience (DX) division, stated, “We will strengthen preemptive responses to the robot era that will begin in earnest in the future.”
Samsung Electronics paid 30,400 won per share to acquire 913,936 common shares of Rainbow Robotics, a KOSDAQ-listed company specializing in collaborative robots. Rainbow Robotics’ stake in Samsung Electronics grew from 10.22% (1,940,200 shares) to 14.99% (2,854,136 shares). As Samsung Electronics’ stake in Rainbow Robotics approaches 15%, some analysts are suggesting that the company could be acquired by Samsung.
Following Chairman Lee Jae-yong’s announcement in August 2021 that he would invest 240 trillion won (US$184 billion) in future new businesses over the next three years, Samsung Electronics began to tighten the reins on the robot business. The robot commercialization task force (TF) was transformed into a robot business team that same year. Samsung Research hired a former Nvidia software engineering manager as an executive in February.
LG Electronics will include the telecommunications business (5G business)
- To create synergies with the robot business, LG Electronics will include the telecommunications business (5G business) in its articles of incorporation at the regular shareholders’ meeting on March 27.
- A 5G-specialized network is a dedicated network that businesses create on distinct frequencies in specific areas. On the other hand, the commercial network was established by the three mobile telecommunications companies. It can be connected to robots, artificial intelligence, and cloud computing technologies.
- Experts predict that 5G-specific networks will be in high demand due to the necessity of a system that can fully control hundreds of robots in a factory or distribution center.
Experts say that LG Electronics will also offer a business solution that includes robots and 5G-specific network construction. In the past, LG Electronics got serious about making robots by buying the management rights to Robostar in 2018. LG Electronics moved the Robot Business Center to the Business Solution (BS) Division in 2020 in preparation for robot commercialization beyond the R&D stage.
Stock market analysts predict that LG Electronics’ sales of robots will nearly double annually, rising from approximately 30 billion won (US$23 million) in 2023 to approximately 130 billion won (US$100 million) in 2025.
Samsung Biologics intends to invest more than 1 trillion won (US$768 million) in the construction of a fifth plant in Songdo, Incheon, Korea. In October of last year, the company presented a strategy to construct a second campus and invest 7.5 trillion won (US$5.8 billion) in the construction of its fifth and sixth factories.
On March 16, industry sources reported that Plant 5 will be constructed with a 180,000-liter annual capacity. On Campus 1, Plant 1 can hold 30,000 liters, Plant 2 can hold 154,000 liters, Plant 3 can hold 180,000 liters, and Plant 4 can hold 240,000 liters. It is the world’s largest CDMO for contract development and manufacturing. The traditional CDMO powerhouse Lonza can produce 330,000 liters annually.
Samsung Biologics’ facility
Samsung Biologics’ facility expansion demonstrates the company’s determination to maintain its lead in securing CDMO plants from global pharmaceutical companies. Pfizer and Samsung Biologics signed a drug CDMO agreement worth approximately 241 billion won (US$185 million) on March 2.
“Plant 5’s capacity of 180,000 liters is based on antibody drugs,” an industry official said. “There is a possibility that production of next-generation drugs such as mRNA and antibody-drug conjugates (ADCs) will be added to the capacity in the future.”
Samsung Biologics now has business relationships with seven of the top ten global pharmaceutical companies thanks to the Pfizer agreement. In addition, the company is currently doing business with major pharmaceutical companies like Novartis, Roche, Johnson & Johnson, BMS, GSK, US Merck (MSD), and others.