Sharp leaning towards Foxconn takeover, but with no exclusive negotiations, CEO says

AppleInsiderAppleInsider
Posted:
in General Discussion
Sharp is indeed leaning towards a takeover by Apple's main manufactuing partner, Foxconn, but no exclusive negotiating rights have been offered, the company's CEO announced at a Thursday press conference.




"We are putting more resources on studying the Hon Hai [Foxconn] offer," said Kozo Takahashi, according to the New York Times. "We are considering the offers from the point of view of all of Sharp's stakeholders, its employees and shareholders."

Takahashi denied an NHK report that Sharp is giving Foxconn exclusive negotiating rights, however. That at least leaves open the possibility of a deal with Innovation Network Corp., a state-backed Japanese fund that would fold Sharp's display business into Japan Display, itself formed from units spun off of Hitachi, Sony, and Toshiba.

Foxconn's offer is believed to be worth at least 600 billion yen (about $5 billion), technically twice as much money as Innovation. The offers are structually different though, and Innovation's deal might be more likely to be approved by Japanese regulators, as well as garner support from various parties worried about a foreign firm swallowing a Japanese icon and weakening local industry. Foxconn has promised not to cut any jobs, but Japanese display suppliers are already fighting to keep up with Chinese and Korean rivals.

Takahashi noted that Sharp will make a decision within the next month.

Whether Foxconn or Innovation wins, Apple orders will be one of the chief prizes of a takeover. Foxconn would be able to provide displays to Apple as well as manufacturing lines, while Japan Display would be able to increase its existing Apple display production.

Comments

  • Reply 1 of 7
    msanttimsantti Posts: 1,377member
    Would rather see Innovation win.

    They would know what do do with Shsrp's technology more I feel.
  • Reply 2 of 7
    volcanvolcan Posts: 1,799member
    About 20% of their revenue is from Apple, but they also have a huge IP portfolio they could license or sell. Competition from Chinese and Korean display makers has put a lot of pressure on them. Sort of the same story except with household appliances that shuttered Sanyo a few years ago.
  • Reply 3 of 7
    Mr_GreyMr_Grey Posts: 118member
    No one would probably say it in print, but in Japan, a Foxconn takeover of Sharp would be viewed similarly to a takeover of some part of the American cattle industry in Texas by Muslim's.  
  • Reply 4 of 7
    teaearlegreyhotteaearlegreyhot Posts: 1,002member
    So the action under consideration is a takeover of SHARP by Foxconn.  Yet the headline implies the reverse, by saying "Sharp leaning towards Foxconn takeover".  SMH.

  • Reply 5 of 7
    lowededwookielowededwookie Posts: 1,143member
    teaearlegreyhot said:
    So the action under consideration is a takeover of SHARP by Foxconn.  Yet the headline implies the reverse, by saying "Sharp leaning towards Foxconn takeover".  SMH.

    I thought the same but on a re-read the headline shows that Sharp has the power to say who will take over it so the headline is correct.
  • Reply 6 of 7
    volcanvolcan Posts: 1,799member
    It is a little complicated with either Foxconn's or Innovation's offer. The Foxconn offer would result in a 2/3 ownership, not a complete take over. The Innovation offer is substantially less but would still give them control. Sharp Corp. will continue to exist with outstanding shares in either deal. The deal would likely require the approval of the Japanese government, the shareholders and the banks that hold Sharp's considerable debt. It is not just a decision to be made by Sharp's management.
  • Reply 7 of 7
    matrix077matrix077 Posts: 868member
    The Foxconn takeover could be a disaster. Japanese employee might not respond well to Chinese executives, regulations and their line of thinking, i.e. don't want to be treated like cattle like most Chinese workers.
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