Toshiba announced on Friday that it would partner with Sharp Corp. and it would start buying liquid crystal displays from it as part of this new deal. Toshiba said that under the pact Sharp would provide it with large liquid crystal display panels, which Toshiba would then use in creating LCD TVs larger than 32 inches to be sold under its own brand.

Toshiba will procure the LCD panels from a $3.4 billion factory that is being built by Sharp in western Japan.

"It would be difficult for one company to do everything on its own. It's necessary to join forces with others that have complementary strengths," said Atsutoshi Nishida, Toshiba’s President. Also as part of this deal, Sharp will buy semiconductors from Toshiba and it will use them in its own LCD TV sets.

The recently announced partnership could have important consequences on the LCD TV industry, especially that Toshiba is likely to sell its 15 percent stake in IPS Alpha Technology, a LCD joint venture with Hitachi and Matsushita Electric Industrial.

According to research firm DisplaySearch, global LCD TV sets sales will likely grow 85 percent to $91 million by 2010.