Japan Display Inc. said Friday that it has secured its ¥80 billion ($740 million) bailout package with an extra capital injection from a Chinese fund.
China’s Harvest Tech Investment Management Co. notified Japan Display of the decision to raise its investment from $300 million to $400 million as part of a share and bond offering, the Japanese display maker said.
Japan Display said in late June that the company was still seeking some ¥11.7 billion for the package. The shortage stemmed from the collapse of a Chinese-Taiwanese consortium following the withdrawal of Taiwanese panel maker TPK Holding Co. and Taiwanese private equity fund CGL group after months of negotiations.
Japan Display plans to hold an extraordinary shareholders’ meeting on Aug. 29 to gain approval to finalize the proposed capital injection.
Apple Inc., one of the main clients of Japan Display, will provide $100 million through Harvest while Hong Kong’s Oasis Management Co. has promised to invest at least $150 million in the bailout plan.
Japan Display also said it will spin off its unit making smartphone displays by December.
Japan Display was established in 2012 following the merger of the display operations of Sony Corp., Hitachi Ltd. and Toshiba Corp. with support from state-back fund INCJ Ltd.
Apple’s recent shift away from liquid-crystal displays has triggered a funding crunch for Japan Display, which depended on the U.S. smartphone maker for 60.6 percent of its revenue in the last financial year ending in March.
The panel manufacturer incurred a group net loss for the fifth straight year in fiscal 2018 through March of ¥109.43 billion on sales of ¥636.66 billion, down 11.3 percent from a year earlier, hit by falling demand from Apple.
Japan Display also said that Oasis Management, already part of the bailout consortium, has offered to extend more financing if currency fluctuations result in a shortfall.