“A state-backed Japanese fund is frontrunner to rescue Sharp Corp, ahead of a rival approach from Apple supplier Foxconn, but industry insiders question whether it can protect the group in the long term amid cut-throat competition,” Ritsuko Ando and Makiko Yamazaki report for Reuters. “Innovation Network Corporation of Japan (INCJ), if successful, would represent the third bailout in as many years for Sharp, known for its liquid crystal display (LCD) technology and super-thin screens. The INCJ is keen to keep it in domestic hands, and plans to merge it eventually with state-owned rival Japan Display.”
“Industry experts and some policy advisers are beginning to question whether “old-school” government intervention can help Sharp’s LCD business survive, as competition from Korean and Chinese rivals ratchets up,” Ando and Yamazaki report. “‘Rather than cutting away the dysfunctional groups, this is about combining the weak part,’ said William Saito, an entrepreneur and special adviser to Prime Minister Shinzo Abe’s cabinet office.”
“Japan Display, formed in a government-backed deal in 2012 from parts of Sony, Toshiba and Hitachi Ltd, was previously seen as a weaker rival. But it is now doing better, thanks to orders from Apple and Chinese smartphone makers for its “in-cell” screens, which are easier to assemble than other types of high-end LCD screens,” Ando and Yamazaki report. “Media reports put the INCJ offer at 300 billion yen ($2.6 billion), and sources say that bailout would also involve Sharp’s lenders offering at least 200 billion yen, by converting debt to equity. The Wall Street Journal on Thursday reported that Hon Hai, also known as Foxconn, was offering 625 billion yen and promising not to replace top management at Sharp, an apparent attempt to soothe nationalist concerns.”
Read more in the full article here.
MacDailyNews Take: The saga continues…
SEE ALSO:
Hon Hai considering $1.7 billion stake in Sharp LCD business; to ask Apple to invest a ‘few hundred million’ – September 28, 2015
Hon Hai offers to buy Sharp’s LCD business, wants Apple funds – September 21, 2015
Apple suppliers Sharp, Foxconn in talks for LCD joint venture – August 24, 2015
Beleaguered Sharp’s problems present an opportunity for mighty Apple – May 15, 2015
Apple display supplier Sharp warns on ability to stay afloat after $1.9 billion loss – May 14, 2015
Apple iPhone display supplier Sharp boosts operating profit – August 1, 2014
Sharp dedicates entire LCD plant to Apple – June 30, 2014
Hon Hai in no hurry to finalize Sharp deal – June 26, 2013
Sharp to replace chairman, president after losses – May 14, 2013
I do like my Sharp tv that I bought last year. Good picture quality. I bought the tv at Costco and it was hard to find alternatives to Samsung since 50% of the available units were from them.
Sharp’s products are good but the main issue is that they need to learn to be more efficient. I would love that Apple use them more but that will probably a change in organization and management to be more competitive.
I hope Sharp survives somehow. More alternatives drives competition and motivates R&D. I detest buying anything from the Samsung IP thieves.
Government ≠ Business. Never was. Never will be. Keep them separate. I can’t imagine the Japanese government playing at keeping Sharp running is going to be helpful.
Nevertheless, Sharp tech should remain Japanese, IMHO. I don’t see anything good coming out of Foxconn grabbing their tech. I’d rather see Panasonic buy the tech and merge it.