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The move comes as leading panel makers attempt to grab a piece of the fast-growing market for active-matrix organic light-emitting diode (AM-OLED) displays, which make better-quality, slimmer and more energy-efficient screens than liquid crystal displays.

But makers need to clear hurdles such as cutting production costs and maximizing screen size in order to see an adoption in a wider range of applications.

Samsung, which produces small-sized AM-OLED screens used

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in handheld devices, said in a filing with the local exchange that it would invest 551.8 billion won (£254 million) by 2009 to expand its AM-OLED output.

When the investment is completed its production capacity will reach 9 million units a month in 2in screen terms, compared with 1.5 million currently, the company claims.

Other makers are also moving fast to launch OLED products and build scale.

Sony last November started selling small-sized TVs using OLED technology, announcing that it would invest over £100 million to further develop its manufacturing techniques and Toshiba plans to ship small-to-medium-size OLED screens for mobile devices in the autumn.

Last week, Japan's Sankei Shimbun daily reported Matsushita is finalising plans to mass produce 37in OLED TVs in three years.

Market researcher iSuppli said in May it expected global shipments of AM-OLED panels to nearly quadruple in 2008 to 10.2 million units, with revenue reaching £110 million.