SEOUL, Oct 11, 2007 (AFP) - Dutch electronics giant Philips has sold down its stake in a joint venture in South Korea to below 20 percent as part of its move to adjust business portfolios, company officials said Thursday.

Philips Electronics sold a 13 percent stake in LG Philips LCD, the world's second largest maker of flat panel screens, to raise 2.2 billion dollars, the joint venture said.

'They divested the shares to international and local financial institutions in a block sale deal in the pre-opening session this morning,' an LG Philips LCD spokeswoman said.

Through the sale the Dutch company reduced its holding to 19.9 percent from 32.9 percent. Its Korean partner, LG Electronics, is the largest shareholder in LG Philips LCD, with 37.9 percent.

Nomura Securities analyst Kim Hee-Yeon said Philips was able to sell the shares more swiftly than expected at a good price because LG Philips LCD posted surprisingly strong third-quarter results this week.

'It's disappointing that Philips failed to find a strategic investor this time, but given its willingness to exit, the rest will likely go to a strategic partner,' she said.

LG Philips LCD CEO Kwon Young-Soo said Tuesday that his company was looking for a new partner. 'The prospective buyers in talks are non-Koreans and they include our major client and financial investor,' he said.

LG Philips LCD had incurred more than one trillion won in operating losses over four straight quarters to March due to a sharp price decline caused by industry-wide oversupply of flat panels and sluggish demand.

But prices started to rebound in April thanks to increased demand for screens used in various tech products.

For the three months to September LG Philips LCD posted a net profit of 524 billion won (570.4 million dollars) compared to a loss of 595 billion won a year earlier.

Sales jumped 42.6 percent to a record 3.95 trillion won. Operating profit reached 693 billion won, the highest since the second quarter of 2004, compared with a 382-billion-won loss a year earlier.

LG Philips LCD said the move by Philips would not hamper the joint venture's plan to build a new production line.