The move shows a developing "united front" approach by the two Korean conglomerates, which together have been enjoying the lion's share of the global markets of mobile phones, digital TVs and LCD panels.

Under the deal, Samsung will buy 37-inch LCD panels from LG Display, a subsidiary of LG Electronics, while LG will buy 52-inch panels manufactured by Samsung.

The two companies are also exploring a cross-purchasing system in which Samsung Electronics' LCD division and LG Display's panel division would buy each other's LCD modules and cells on a regular basis.

The 37-inch LCD panels are currently manufactured only by LG Display and Taiwanese firms such as Au Optronics Corporation and Chi Mei Optoelectronics. Samsung had been sourcing all of its panels of this size from the Taiwanese firms, while LG Electronics had imported 34 percent of its 52-inch panels from Taiwan.

The two will decide on the quantities and prices of the products traded under the deal by July, depending on market conditions.

Despite a desire for such a deal, a subtle battle of egos between the two companies had resulted only in benefiting Taiwanese firms, industry insiders have said.

In a surprise move on Wednesday, Samsung Electronics and LG Electronics agreed to jointly develop a mobile TV technology aimed at becoming the industry standard in North America.

(englishnews@chosun.com )