Hon Hai to ask Apple to invest in Sharp LCD: report
Taiwan-based Hon Hai Precision Industry Co. ( ), the world’s largest contract electronics maker, is planning to ask Apple Inc. to jointly invest funds to buy a stake in Japan- based Sharp’s liquid crystal display business, according to Japanese newspaper Mainichi Shimbun.
The report said that talks on acquisition of a stake in Sharp’s LCD business between Hon Hai and the Japanese firm have made a breakthrough, and the potential Taiwanese suitor is expected to spend 200 billion Japanese yen (US$1.67 billion) to buy part of the business.
However, the acquisition consideration is too high, the report said. Hon Hai, also known as Foxconn Technology Group ( ) outside Taiwan, is mulling the possibility of having Apple as a partner for the buy-out deal.
Apple is one of Hon Hai’s most important customers and accounts for more than 40 percent of the Taiwanese manufacturer’s total revenue each year. Both sides have built close business ties, with Hon Hai assembling iPhones and iPads for the U.S. consumer electronics giant.
According to the Mainichi Shimbun, Hon Hai is considering a request to Apple, in the hope that the U.S. business partner will invest a “few hundred million dollars” to help with funding the purchase.
Hon Hai declined to comment on the report, although the possibility of acquiring a stake in Sharp’s LCD operations has attracted attention from news media organizations at home and abroad, including prominent Japanese newspapers.
In a quarterly earnings report ending at the end of June, Sharp said that it incurred 33.98 billion yen in losses, jumping from a loss of 1.79 billion in losses recorded over the same period of last year.
Kozo Takahashi, president of financially struggling Sharp, said in March that he is open to any measure that leads to a restructuring of the company’s LCD business, including the introduction of strategic investors.