Universal Display (Nasdaq: PANL) is growing up fast.
The OLED technologist is expanding beyond its facilities in Ewing, New Jersey, and opening shop in Seoul, South Korea. The new digs are conveniently located a stone's throw from the offices of OLED manufacturing leader Samsung SDI, and near the headquarters of second-largest manufacturing partner LG Display (NYSE: LPL).
Getting much closer to its leading partners should help Universal Display hammer out manufacturing issues, negotiate licensing contracts, and generally collaborate on a whole new level with these important companies. The move also makes me think we'll soon see an end to the series of short-term extensions to Universal Display's license agreement with Samsung. Would you move in with your significant other if he or she were about to become your ex? I see a fresh long-term agreement in the stars over Seoul.
The new offices also put Universal Display closer to a number of potential customers. Korean electronics giant Kyocera (NYSE: KYO) pulled out of the OLED game last year, and it's not likely to jump back in. But Seoul is a heck of a lot closer to the Japanese headquarters of Sony (NYSE: SNE) and Toshiba than New Jersey ever will be. Teleconferencing is great, but sometimes there's just no substitute for face-to-face meetings over a hot bit of hardware. Asia is where the electronics action is.
The OLED market is practically screaming for more manufacturing capacity, and Universal Display is doing the legwork to make it happen. Korean offices may sound like an extravagant luxury, but in this case, it makes perfect sense to me as a business necessity.
