OSAKA – Sharp Corp. is considering ceasing all overseas production of LCD televisions with the exception of operations in China as it tries to improve the picture for its flickering TV business, sources close to the matter said.
The ailing electronics maker has suffered multiple years of losses from its TV business amid intensifying competition from rivals in South Korea and elsewhere.
By reducing business costs abroad, the Osaka-based company would aim to bolster TV production at home, where the yen’s sharp depreciation is helping boost exports, the sources said Thursday.
Sharp plans to slash the workforce at its subsidiary in Malaysia, its production hub for Southeast Asian markets, and sell a TV assembly factory there, while also halting TV sales in Australia through its own channel, they said.
Sharp is also eyeing selling or leasing its TV factory in Mexico, which supplies the North American market.
It has already withdrawn from TV production and sales in Europe.
Earlier this year, Sharp President Kozo Takahashi told reporters that the company will accelerate repatriating production on the back of the yen’s plunge.
As part of that effort, Sharp is considering expanding the range of large-screen LCD TVs it assembles at its plant in Yaita, Tochigi Prefecture, Takahashi said.
The company has said it expects to post a ¥12 billion operating loss in its TV business for the business year ending this month.
On Thursday, executives of Sharp, which is trying to strengthen its financial base necessary for restructuring, met with Mizuho Bank and Bank of Tokyo-Mitsubishi UFJ.
Sharp is believed to have requested fresh aid from its two main creditor banks and explained to them its turnaround strategies, such as the closure of four electronic parts factories in Hiroshima Prefecture and the sale of a solar battery factory in Sakai, Osaka Prefecture.
If the two banks agree on a bailout for Sharp, they will each provide ¥75 billion each through a debt-for-equity swap, the sources said.
The electronics maker is also looking to raise ¥25 billion via a third-party allocation of shares to domestic and foreign companies, they said.
Sharp is expected to incur about ¥200 billion in group net loss for this business year as it plans to implement additional restructuring.
The core banking units of Mizuho Financial Group Inc. and Mitsubishi UFJ Financial Group Inc. offered a total of ¥360 billion in loans to Sharp in 2012.
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