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Hon Hai chairman makes direct offer to revive struggling Sharp

Kyodo

The chairman of Taiwan’s Hon Hai Precision Industry Co. made a direct offer Saturday to the top management of Sharp Corp. to help revive the struggling Japanese electronics maker, as the Taiwanese company seeks to tip the scales in its favor in the face of a rival offer.

“We want to help Sharp. Sharp has a 100-year history … We want to keep it alive for maybe another hundred years. This is my goal,” Terry Gou, the head of the company, told reporters at Kansai International Airport after visiting the headquarters of Sharp in Osaka for about two hours.

The potential tie-up would see Hon Hai take over Sharp with an investment of around ¥600 billion (roughly $4.9 billion).

A Japanese state-backed fund also has plans to rescue Sharp. According to sources close to the matter, the public-private fund Innovation Network Corporation of Japan has proposed investing around ¥300 billion in Sharp in a plan that would also involve assistance from its creditor banks.

Struggling with its money-losing liquid crystal display business, Sharp is leaning toward accepting the fund’s proposal, reflecting the Japanese government’s efforts to prevent Sharp’s advanced technology from being acquired by foreign firms, the sources said.

While Gou did not elaborate on the details of his company’s proposed investment, which he explained to Sharp President Kozo Takahashi and other executives, he described his trip to Japan as a “very successful visit.”

Speaking to reporters at the airport before returning home, Gou said he will be waiting for Sharp’s final decision.

Sharp is expected to announce its decision to accept the fund’s offer as early as Thursday when the Osaka-based firm will release its latest earnings, other sources said.

An aide close to Gou also quoted the chairman as saying he wants to “definitely revive” the electronics maker. Gou also said he plans to have Sharp employees keep their jobs, the aide said.

Going by the trade name Foxconn, Hon Hai, a key supplier for Apple Inc., is the world’s leading player in contract manufacturing services for smartphones and home appliances.

Sharp was rescued last May in a ¥225 billion bailout from banks following a slump in the LCD business. Since then, pressure from creditor banks frustrated with the firm’s slow progress in improving its earnings has also lead to job cuts and the selling of its head office building.

  • Tachomanx

    I don’t see this guy keeping any of it’s promises regarding keeping japanese jobs or even a base of operations in Japan.