LG Electronics said Monday it won’t quit its solar module business, denying rumors that it has been searching for a financial advisor since last year to sell off the business.

In response to recent local media reports that it is considering to sell off its solar module business due to a lack of price competitiveness against cheaper Chinese modules, the home appliance giant said such claims are unsubstantiated.

“LG Electronics is currently injecting tens of millions of dollars into a solar module plant in Gumi, North Gyeongsang Province, to add new production lines to manufacture solar modules with higher efficiency. If we wanted to sell the solar module business, why would we make such an investment? The rumors just don’t make sense,” a company official said.

After turning profit a few years ago, the solar module business, which belongs to LG Electronics’ business solutions division, has remained profitable since, according to industry sources.

LG Electronics is the No.2 solar module maker in Korea, with an annual production capacity of 2.3 gigawatt-hours, following Hanwha Q Cells’ 4.5 gigawatt-hours. LG Electronics’ most efficient solar module NeON R can convert 21.4 percent of solar energy into usable energy while Hanwha Q Cell’s Q.Peak Duo G9 has a 20.6 percent energy efficiency level.

Based on its premium brand image and vast global infrastructure, LG Electronics ranked second in the residential solar power market in the US, commanding 13.3 percent of the market. In the commercial solar power market, it took third place, controlling 10.3 percent, according to energy consulting firm Wood Mackenzie.

By Kim Byung-wook (kbw@heraldcorp.com)