Japanese electronics giant Sharp Corp yesterday announced a ￥132.9 billion (US$1.6 billion) tie-up with Taiwan’s Hon Hai Precision Industry Co (鴻海精密) as part of an LCD panel tie-up as it looks to reverse recent losses.
Under the deal, Sharp would sell 121 million new shares for ￥66.9 billion to Hon Hai. In addition, Hon Hai chairman Terry Gou (郭台銘) and related investment corporations would buy 46.5 percent of Sharp’s display unit for ￥66 billion.
Hon Hai, parent company of manufacturing giant Foxconn Technology Group (富士康科技集團), which builds gadgets for Apple Inc, will own about 9.9 percent of Sharp after the sale, making it the Japanese firm’s biggest shareholder.
The Taiwanese firm will buy about half the LCD panels produced at the loss-making Sharp Display Products Corp, a venture with Sony Corp in Sakai, Sharp said, in a partnership aimed at creating stable demand for the panels.
“Our firm’s unique devices and technological strength, coupled with Hon Hai’s manufacturing strength and scale, should allow us to introduce attractive products and services in a timely fashion,” incoming Sharp president Takashi Okuda said in a statement.
Later, Okuda told a press briefing that “we wanted to go beyond national borders and seek opportunities to expand our business.”
Sharp, Japan’s largest maker of flat panels, last month forecast a record ￥290 billion loss for the year ending March 31 as TV prices dropped and the yen reached a post-World War II high.
“We needed to take action, as we face a strong yen and a rapidly changing business environment,” Okuda said. “It’s no longer an option to do everything from development, design, manufacturing, marketing and customer service. It’s more important for us to collaborate with business partners to be competitive in the market.”
Hon Hai entities will buy 121.65 million new shares in Sharp, according to the statement. Hon Hai Precision and fully owned unit Foxconn (Far East) Ltd will hold 6.6 percent of Sharp, while Foxconn Technology Co (鴻準), the Taipei-listed maker of computer casings and electronics, and its unit, Q-Run Holdings Ltd, will own 3.3 percent, Simon Hsing (邢治平), a spokesman for Taipei-based Hon Hai, said by phone.
The sale of its Sharp Display Products shares will cut Sharp’s stake in the venture with Sony to 46.5 percent. Sony will keep its 7 percent holding, the firm said.
Japan’s electronics giants have been bleeding red ink, partly due to their loss-making TV units as the strong yen makes their products more expensive overseas, while they face tough competition from rivals like Samsung Electronics Co.
Japanese firms were also hit by sluggish demand for TVs at home, after record sales last fiscal year due to a temporary subsidy as the nation shifted to digital terrestrial broadcasting from an analog system.
“It’s positive for Sharp,” said Mitsushige Akino, of Ichiyoshi Investment Management Co in Tokyo. “The company got a backup for its capital and the partnership will also make it easier for Sharp to expand in China and Taiwan.”
Taiwan is projected to lose a working-age population of about 6.67 million people in two waves of retirement in the coming years, as the nation confronts accelerating demographic decline and a shortage of younger workers to take their place, the Ministry of the Interior said. Taiwan experienced its largest baby boom between 1958 and 1966, when the population grew by 3.78 million, followed by a second surge of 2.89 million between 1976 and 1982, ministry data showed. In 2023, the first of those baby boom generations — those born in the late 1950s and early 1960s — began to enter retirement, triggering
ECONOMIC BOOST: Should the more than 23 million people eligible for the NT$10,000 handouts spend them the same way as in 2023, GDP could rise 0.5 percent, an official said Universal cash handouts of NT$10,000 (US$330) are to be disbursed late next month at the earliest — including to permanent residents and foreign residents married to Taiwanese — pending legislative approval, the Ministry of Finance said yesterday. The Executive Yuan yesterday approved the Special Act for Strengthening Economic, Social and National Security Resilience in Response to International Circumstances (因應國際情勢強化經濟社會及民生國安韌性特別條例). The NT$550 billion special budget includes NT$236 billion for the cash handouts, plus an additional NT$20 billion set aside as reserve funds, expected to be used to support industries. Handouts might begin one month after the bill is promulgated and would be completed within
NO CHANGE: The TRA makes clear that the US does not consider the status of Taiwan to have been determined by WWII-era documents, a former AIT deputy director said The American Institute in Taiwan’s (AIT) comments that World War-II era documents do not determine Taiwan’s political status accurately conveyed the US’ stance, the US Department of State said. An AIT spokesperson on Saturday said that a Chinese official mischaracterized World War II-era documents as stating that Taiwan was ceded to the China. The remarks from the US’ de facto embassy in Taiwan drew criticism from the Ma Ying-jeou Foundation, whose director said the comments put Taiwan in danger. The Chinese-language United Daily News yesterday reported that a US State Department spokesperson confirmed the AIT’s position. They added that the US would continue to
IMPORTANT BACKER: China seeks to expel US influence from the Indo-Pacific region and supplant Washington as the global leader, MAC Minister Chiu Chui-cheng said China is preparing for war to seize Taiwan, Mainland Affairs Council (MAC) Minister Chiu Chui-cheng (邱垂正) said in Washington on Friday, warning that Taiwan’s fall would trigger a regional “domino effect” endangering US security. In a speech titled “Maintaining the Peaceful and Stable Status Quo Across the Taiwan Strait is in Line with the Shared Interests of Taiwan and the United States,” Chiu said Taiwan’s strategic importance is “closely tied” to US interests. Geopolitically, Taiwan sits in a “core position” in the first island chain — an arc stretching from Japan, through Taiwan and the Philippines, to Borneo, which is shared by
RSS