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Sharp agrees to Foxconn takeover
2016-02-25 09:14:00| Telecompaper Headlines
(Telecompaper) Sharp has agreed to a takeover bid from Taiwan's Hon Hai Precision Industry. Hon Hai, better known as Foxconn, is expected to acquire a majority stake in Sharp by buying JPY 489 billion in new shares issued by the company. In addition, Hon Hai plans to purchase half of the shares held by Sharp's creditors for JPY 100 billion. Sharp chose Foxconn's takeover bid over support from the Innovation Network Corp of Japan, a state-backed fund. Sharp said the offer from Foxconn included a pledge to invest in expanding its LCD business, and the two also have complementary operations. In addition, Foxconn pledged to allow Sharp operational independence, including its brand, unified operations and R&D in Japan, and to maintain employment at the company. In return, Hon Hai will have a majority of seats on Sharp's board. Sharp said the agreement will allow it to realise the goals of its medium-term strategic plan, including necessary capital expenditure for growing its business and paying off debt.
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Category:Telecommunications