Sharp may sell solar cell plant in Sakai

Kyodo

Sharp Corp. is thinking of selling a key solar cell plant in Sakai, Osaka Prefecture, to bolster its finances and lift its flagging stock price, sources said Thursday.

The Osaka-based company is also considering selling off some properties, including the Ichigaya building in Shinjuku Ward in Tokyo and the Makuhari building in the city of Chiba, the sources said.

The Sakai plant, which produces thin-film solar cells for large solar power stations, has an annual capacity of 160,000 kw. The business is losing money amid dropping prices driven by harsh competition from Chinese and other overseas manufacturers.

On Wednesday, Sharp’s share price dropped below ¥170 for the first time in about 38 years in light of its increasingly uncertain business outlook.

Sharp and Taiwanese business partner Hon Hai Precision Industry Co. failed to announce a deal to boost Sharp’s capital base last week despite widespread expectations they would review the terms of their capital tieup agreement following a recent plunge in Sharp’s shares.

The Hon Hai group (also known as Foxconn) agreed with Sharp in March to buy a 9.9 percent stake in the electronics giant at ¥550 per share, but the two are in talks to lower the price after a plunge triggered by huge losses Sharp recently reported.

Earlier reports also quoted other sources as saying Sharp might issue preferred securities and subordinated bonds to close business partners to make up for a drop in Hon Hai’s investment.