Facing stiff competition from South Korean and Chinese rivals, Japan Display is considering drastic restructuring, including asking for a capital injection from an outside investor, sources said Wednesday.
The liquid crystal display maker is also looking to again postpone to next year or later its acquisition of a majority stake in Joled Inc., which is developing organic light-emitting diode displays touted as a next generation alternative to LCDs, the sources said.
Japan Display has already pushed back the acquisition from September this year to December.
Japan Display has posted a net loss for three straight years, hit by price competition and volatile demand for LCDs for smartphones.
Just last year, it received ¥75 billion ($683 million) in bailout funds from its lead shareholder, the state-backed Innovation Network Corp. of Japan, under the pretext of cash to invest in development of OLEDs.
The company will likely announce its reform plan in August, the sources said.
Sharp, a unit of Hon Hai Precision Industry, has expressed interest in a tie-up, with a senior company official telling reporters Wednesday it makes sense for Japanese display makers to join hands.
Japan Display was established in April 2012 through the state-led merger of the LCD units of Sony, Toshiba and Hitachi.