Samsung Electronics Co. bought a South Korean medical-equipment company, the first step in a long-discussed plan to diversify from consumer electronics.
Samsung's purchase Tuesday of a controlling stake in Medison Co., a maker of ultrasound monitors, was small enough that Samsung wasn't required to disclose the terms.
The purchase is more significant as a signal of Samsung's direction than for any financial impact. Medison's revenue amounted to 154 billion won ($134 million) in the first nine months of the year.
That is tiny in comparison to Samsung's four main product divisions—semiconductors, liquid-crystal-display panels, cellphones and television sets—with revenue of $22 billion to $38 billion each in the same nine months.
The decision to enter the medical-products field mirrors that by manufacturers in other countries—including General Electric Co. in the U.S. and Philips Electronics NV in the Netherlands—in decades past as the competitive landscape changed and earnings from consumer electronics faded. GE today is only a marginal player in electronics, while Philips gets only about one-fourth of its revenue and profit from electronics.
For more than a year, Samsung executives have touted plans to spend billions of dollars in the coming decade to enter higher-margin industries, such as medical products and solar equipment.
Samsung's purchase Tuesday of a controlling stake in Medison Co., a maker of ultrasound monitors, was small enough that Samsung wasn't required to disclose the terms.
The purchase is more significant as a signal of Samsung's direction than for any financial impact. Medison's revenue amounted to 154 billion won ($134 million) in the first nine months of the year.
That is tiny in comparison to Samsung's four main product divisions—semiconductors, liquid-crystal-display panels, cellphones and television sets—with revenue of $22 billion to $38 billion each in the same nine months.
The decision to enter the medical-products field mirrors that by manufacturers in other countries—including General Electric Co. in the U.S. and Philips Electronics NV in the Netherlands—in decades past as the competitive landscape changed and earnings from consumer electronics faded. GE today is only a marginal player in electronics, while Philips gets only about one-fourth of its revenue and profit from electronics.
For more than a year, Samsung executives have touted plans to spend billions of dollars in the coming decade to enter higher-margin industries, such as medical products and solar equipment.
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