The Bank of Tokyo-Mitsubishi UFJ (BTMU) decided Monday to set a new credit line for Sharp Corp., sources familiar with the matter said, as the struggling electronics maker seeks to sign a takeover deal with Taiwan’s Hon Hai Precision Industry Co.

Sharp’s other major creditor bank, Mizuho Bank, is also expected to make its own decision on Wednesday, bringing the total amount of loans that can be extended to ¥300 billion ($2.64 billion).

Hon Hai, also known by its trade name Foxconn, had requested that the two banks agree to extend loans as a precondition for the Apple Inc. supplier to invest in Sharp.

In addition to the credit line, BTMU will also accept lowering interest rates on existing loans taken out by Sharp, according to the sources.

Hon Hai had planned to buy Sharp’s preferred shares held by Mizuho and BTMU for ¥100 billion, but the purchase may be delayed by around three years and the amount paid will likely be scaled back.

Sharp and Hon Hai have been working to reach an agreement since the Taiwanese firm put the deal on hold in late February to review the financial standing of the firm, which had provided new information about its contingent liabilities.

Hon Hai said Sunday it will hold a board meeting on Wednesday as scheduled, where it may discuss the Sharp deal depending on the stage of negotiations, according to a statement to the Taiwan stock exchange.

Sharp released a statement on Monday saying the two companies “are holding discussions to reach a satisfactory agreement as soon as practically possible.”

The shares of Sharp rose 4 percent to ¥131 at the close in Tokyo, their biggest jump since March 7. The Nikkei 225 stock average advanced 0.8 percent.

“Some investors were beginning to fear that Foxconn was going to walk away from the deal,” said Masahiko Ishino, an analyst at Tokai Tokyo Securities. “The shares are rebounding on renewed confidence that the investment seems on track.”