Hon Hai to invest 500 bil. yen in Sharp, say reports


CNA

TAIPEI–Taiwan-based Hon Hai Precision Industry Co. (鴻海), the world’s largest contract electronics maker, plans to invest 500 billion Japanese yen (US$4.1 billion) in the financially struggling Japanese electronics giant Sharp Corp., according to media reports in Japan.

Apart from Hon Hai, Innovation Network Corporation of Japan, a public-private partnership aimed at promoting innovation and enhancing the value of businesses in Japan, has proposed a 200 billion yen investment in Sharp, TV Asahi said.

Although the Japanese government would be hesitant to see Sharp hand over its display product line to foreign companies, Hon Hai’s successful operation in Sharp’s flat screen plant, Sakai Display Products (SDP), in Osaka may increase its chances of obtaining a stake in Sharp, Japanese media said.

Taiwan-based Hon Hai would be more favorably considered than its Chinese or South Korean competitors, the reports said.

In July 2012, Hon Hai Chairman Terry Gou (郭台銘), in a personal capacity, acquired a 37.6 percent stake in SDP to become an equal partner with Sharp in the plant.

The Nihon Keizai Shimbun had reported earlier that Hon Hai was likely to raise its stake in the Sakai plant to over 50 percent by buying Sharp’s shares.

By investing in Sharp, Hon Hai may be looking to become Apple Inc.’s main supplier of iPhone displays, competing with companies such as LG Display of South Korea and Japan Display Inc., according to media reports.