Sharp declines added investment from Hon Hai

Kyodo

Sharp Corp. President Takashi Okuda said Tuesday his company has no plans to accept additional investment from Taiwan’s Hon Hai Precision Industry Group, which will buy a 9.9 percent stake in the electronics manufacturer.

“We have no plan to receive more investment or executives” from Hon Hai, Okuda told a general shareholders’ meeting in Osaka.

Hon Hai, better known internationally under its trading name Foxconn, which supplies products to Apple Inc. and other U.S. electronics makers, has indicated it is willing to increase its shareholdings in Sharp.

At the outset of the meeting, Chairman Mikio Katayama apologized for Sharp posting its largest-ever group net loss — ¥376.08 billion — for the business year to March 31, saying, “We are sorry for not being able to live up to expectations, including share prices.”

On the capital alliance that Sharp has agreed to form with Hon Hai, Okuda explained that the tieup will help the Osaka-based company achieve stable operations at its plant making large liquid crystal panels in Sakai, Osaka Prefecture. The plant will be jointly operated by the two companies.

The company will also release Sharp-brand products in various parts of the world by capitalizing on Hon Hai’s cost-competitiveness, Okuda said.

Meanwhile, a shareholder expressed concern that the alliance could lead to the outflow of Sharp’s technology.

Sharp plans on outsourcing its production of smartphones to Hon Hai and sell them under its own brand name in China starting in the next business year.