Japan Display Inc. is in talks with private fund Ichigo Asset Management Ltd. about a capital injection of around ¥90 billion that would shore up its ailing finances, sources close to the matter said Thursday.
The struggling display-maker said in a statement that it was discussing the deal with Ichigo, adding that its board meeting would take up the issue later in the day.
If approved, Japan Display was set to make an announcement Thursday or later, the sources said.
Japan Display’s major client Apple Inc. and others had previously proposed an investment of up to $430 million, but the U.S. tech giant is instead now considering a plan to purchase some portions of the panel-maker’s facilities in Ishikawa Prefecture for $200 million.
Apple’s shift in direction is apparently aimed at avoiding dilution of equity in Japan Display and facilitating the investment by Ichigo, the sources said.
Another prospective sponsor, Taiwanese electronics giant Wistron Corp., had offered to directly provide funds to Japan Display, but is also considering a purchase of the struggling display-maker’s assets, the sources said.
Japan Display initially tried to secure financial support of up to ¥80 billion from a Chinese-Taiwanese consortium, but the plan effectively stalled in September when China’s Harvest Tech Investment Management Co. withdrew from the consortium, forcing the ailing company to seek new prospective investors.
Japan Display reported a group net loss for the fiscal first half through September of ¥108.67 billion due to massive restructuring costs. Its negative net worth widened to ¥101.6 billion as of the end of September.
Japan Display was established in 2012 through the merger of the display operations of Sony Corp., Hitachi Ltd. and Toshiba Corp. with support from the state-backed fund INCJ Ltd.