The venture, which is expected to become fully owned by the Chinese company within 18 months, could help TCL circumvent anti-dumping rules in the US and European markets as it pursues its ambition to become a global brand. At the same time, Thomson gains access to China's cheap manufacturing base, analysts said.

"This is a big deal -- the marriage between the biggest TV seller in China and the United States," said Zhaohong Li, an analyst at Daiwa Securities.

The joint venture, two-thirds owned by fast-growing TCL and one-third by Thomson, would crank out 18 million TVs a year and have annual sales of more than three billion euros ($3.51 billion). Thomson said it would shift about 1.25 billion euros in annual revenues to the venture but added the deal would not entail new job losses or charges.

Thomson shares rose as much as six percent in Paris to 19.20 euros after gaining 14 percent last week on expectations that it would strike a deal with TCL. Trading in TCL shares, which gained 29 percent last week, was suspended in Hong Kong.

The deal creates a beefed-up, low-cost rival to other big TV makers such as Japan's Sony Corp, LG Electronics Ltd of South Korea, and Dutch giant Philips Electronics NV, as well as Chinese foes Changhong, Skyworth Digital Holdings Ltd and Shenzhen Konka Group Co Ltd.