Foxconn may buy Sharp's LCD business, with assistance from Apple

Posted:
in General Discussion edited September 2015
Sharp's LCD spinoff may end up in the hands of manufacturing giant Foxconn, thanks to a potential investment by Apple, helping to give the iPhone maker greater control of its sprawling supply chain.




Foxconn has apparently made a proposal to purchase Sharp's LCD business, according to Nikkei. In the potential deal, Foxconn would take a majority stake of the LCD maker, while Apple would also contribute.

Apple already has a major stake in Sharp's LCD business --?the company's Kameyama plant No. 1 in Japan solely produces displays for Apple's iPhone. Apple is said to have supplied more than half of the 100 billion yen, or $987 million, needed to transition the plant from HDTV panels to smartphone LCDs, giving the Cupertino company operational control of the facility.

A Foxconn takeover of Sharp's LCD spinoff could have numerous benefits, according to Nikkei --?it would allow Foxconn to limit Sharp's risk but enable the company to stay involved in the business, and it could also enable Sharp to keep its Japanese staff.

It's said that lenders value the Sharp LCD business at about 300 billion yen, which is about $2.5 billion U.S. It is unknown how much a Foxconn takeover could run, or how much more Apple would be willing to invest in the facilities.

Sharp has been floating a variety of potential restructuring plans for some time. But as of last month, talks seemed to push toward a partnership between Sharp and Foxconn.

KameyamaSharp's Kameyama LCD plant in Japan's Mie Prefecture.


Those negotiations have apparently continued behind the scenes with Apple's involvement, as Sharp decides what it will do with its newly independent LCD company. The company has been exploring options for its LCD operations in light of declining revenues.

In addition to iPhones, current iPads, and other Apple devices, Sharp is also believed to be the main supplier of Retina displays for the forthcoming iPad Pro. That device will sport a 2,732-by-2,048-pixel panel, packing 5.6 million pixels into its 12.9-inch frame.
«13

Comments

  • Reply 1 of 43
    tmaytmay Posts: 3,129member
    This looks to be a good thing for all the parties; a good use of Apple's overseas stash.
  • Reply 2 of 43
    melgrossmelgross Posts: 31,036member
    It's interesting, and unusual, that Apple would tie itself to a maker with such severe financial problems. Foxconn would remove that risk.
  • Reply 3 of 43
    Keep the Japanese. Don't trust the Chinese.
  • Reply 4 of 43
    matrix07 wrote: »
    Keep the Japanese. Don't trust the Chinese.

    What is Foxconn then?
  • Reply 5 of 43
    sog35 wrote: »
    after the debacle with that crappy sapphire producer this looks like a good move.

    GTAT's sapphire was not all it was cracked-up to be.
  • Reply 6 of 43
    melgrossmelgross Posts: 31,036member
    What is Foxconn then?

    Taiwanese. Which is Chinese, sort of.
  • Reply 7 of 43
    Thinking about it some more I think Apple couldn't care less. They're in the process to move all the screens to OLED at some point in the near future. Next year with iPhone 7 possibly. ( the market of the Watch is still too small)
  • Reply 8 of 43
    Buy Samsung instead.
  • Reply 9 of 43
    lkrupplkrupp Posts: 6,396member

    I’ve always had good luck with Sharp LCD HDTVs. I still have a 46” one that’s going on eight years old and the picture is still great. The Samsung 60” Smart TV in the living room is not so smart after all, however.

  • Reply 10 of 43

     Be nice. Samsung's cell phone business is going down the proverbial toilet. Say positive things like. "Samsung makes great dishwashers and washing machines."

  • Reply 11 of 43
    paxmanpaxman Posts: 4,580member
    matrix07 wrote: »
    Keep the Japanese. Don't trust the Chinese.
    Is that just a general rule, then, mr Trump?
  • Reply 12 of 43
    sog35 wrote: »
    crap.  Thanks for reminding me their name.  I totally forgot their name. they lost me a couple thousand last year

    When did the scar on your forehead go away from banging your head continuously for days against the wall to get your point across that GTAT was inherently corrupt? :D
  • Reply 13 of 43
    melgrossmelgross Posts: 31,036member
    When did the scar on your forehead go away from banging your head continuously for days against the wall to get your point across that GTAT was inherently corrupt? :D

    There were times when you could have made a lot of money on their stock. I kept thinking of investing, but something kept bothering me about it, so I didn't. But the stock was cheap.

    I also keep thinking of investing in Liquidmetal. Their stock is literally pennies. The entire company is just worth about $49 million. Sheesh, I could get a substantial part of the company. I just keep wondering why Apple never bought it.
  • Reply 14 of 43
    matrix07 wrote: »
    Thinking about it some more I think Apple couldn't care less. They're in the process to move all the screens to OLED at some point in the near future. Next year with iPhone 7 possibly. ( the market of the Watch is still too small)

    Has Apple avoided OLED up to this point because of engineering reasons or supply chain reasons? Samsung is the largest maker of OLED displays that could possibly fulfill Apple's requirements. Samsungs phone division is taking most of that supply. What would keep Foxconn and Apple from retooling the Sharp facility to make OLED to Apple's specs? Perhaps even a higher quality and multifunctional display that keeps the iPhone/iPad a step ahead of the competition. 4K displays on the next iPad Pro? Who knows? Only Apple and maybe Foxconn. There is a reason for everything that Apple does. After they got burned on the sapphire disaster it's a safe bet they are being careful and also letting Foxconn take a lot of the risk here. They also have plenty of overseas cash to back up this deal without taking much of a financial risk. One last thing is that the Japanese economy is a safer place than China right now.
  • Reply 15 of 43
    Just a matter of time before Foxconn screws Apple and starts making its own competing mobile devices...lol.
  • Reply 16 of 43
    melgross wrote: »
    Taiwanese. Which is Chinese, sort of.

    Any Taiwanese person will strongly disagree that they are Chinese.
  • Reply 17 of 43
    Just a matter of time before Foxconn screws Apple and starts making its own competing mobile devices...lol.

    Apple does seem to be extraordinarily dependent on Foxconn. I'd like to know what they have planned as a replacement in case of an 'emergency'.
  • Reply 18 of 43
    Quote:
    Originally Posted by melgross View Post



    I also keep thinking of investing in Liquidmetal. Their stock is literally pennies. The entire company is just worth about $49 million. Sheesh, I could get a substantial part of the company. I just keep wondering why Apple never bought it.

    Agreed. I bought a bunch Liquidmetal at ¢27 per share. It has never got to that level since I bought it (of course).

     

    I am viewing it as a (very) long-dated call option that may, one day, expire worthless.... :\ 

     

    (Didn't buy any GTAT, though. Phew).

  • Reply 19 of 43
    Quote:
    Originally Posted by SpamSandwich View Post



    Apple does seem to be extraordinarily dependent on Foxconn. I'd like to know what they have planned as a replacement in case of an 'emergency'.

    Other than for the fact that have each other by the.... um, neck.... and therefore have an interest in each other's survival, yes, it is a tad worrisome.

  • Reply 20 of 43
    Quote:

    Originally Posted by SpamSandwich View Post

     
    Quote:

    Originally Posted by melgross View Post



    Taiwanese. Which is Chinese, sort of.




    Any Taiwanese person will strongly disagree that they are Chinese.

    But it may head in that direction. In any event, when Tim Cook uses the phrase "Greater China", I think he includes Taiwan.

Sign In or Register to comment.