TOKYO (AP) -- Sony Corp. said Thursday it will begin talks with Seiko Epson Corp. to form an alliance for small liquid crystal displays used in digital cameras and mobile phones.
Sony said the two companies aim to sign an agreement by the end of June. As part of the deal, Sony said it may buy some assets of Seiko Epson. A Sony spokeswoman declined to give further details.
The Japanese electronics giant said it hopes an alliance with Seiko Epson would boost the competitiveness of its small- and mid-sized LCD business.
Sony's electronics division has lost out in recent years to rivals, including Sharp Corp. in flat-panel TVs and even in Walkman equivalents to Apple's iPod.
The company is expecting a 150 billion yen ($1.6 billion) net loss for the fiscal year through March amid plummeting demand at home and abroad.
Sony has said it is slashing 8,000 of its 185,000 jobs around the world and shuttering five or six plants -- about 10 percent of its 57 factories. It is also trimming another 8,000 temporary workers who aren't included in the global work force tally.