Reports suggest that Apple has opted to further distance Samsung Electronics from its supply chain in construction of its 7.85 inch iPad Mini, rumored to be launched in Q3 2012. It has been reported that AU Optronics has received an order for Apple for LCD panels, along with its partner Forhouse. It has also been suggested that Apple plans to buy panels from LG, and exclude Samsung from the supply chain.

Apple also reportedly plans to hire Pegatron Technology to build the iPad Minis, a change from Foxconn Electronics, the maker of the majority of the previous iPad versions.

Meanwhile, a Samsung Securities investors report adds further credibility to a Q3 release of the 7 inch device. The report states that “following the success of its iPad 1 and iPad 2, which have together achieved sales of 55m units, Apple plans in 1Q12 to launch the iPad 3 and in 3Q12 a new 7-inch product temporarily referred to as the iPad mini,” according to analyst JungHoon Chang, in December 2011. Chang adds, “Apple may yet decide to use flexible panels in its next iPad models, if panel makers (such as SMD) can mass produce flexible AMOLED panels and improve resolution. Samsung’s smaller panel division could produce only 54m AMOLED panels per year, even if its 5.5G line were full used for tablet PC production.” Though even if Apple opts for flexible AMOLED screens over LCD, it’s unlikely that Samsung could accomodate the demand. It makes sense that Apple would seek to distance itself from Samsung while building a smaller tablet.

Apple plans to unveil its iPad 3 this week. Interestingly, it has been reported that Samsung might have manufactured the Retina Displays included with the devices.