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Hon Hai head sees cooperation, not price, as key to Sharp deal

Hon Hai head sees cooperation, not price, as key to Sharp deal

Tokyo, Aug. 27 (CNA) Hon Hai Precision Industry Co. Chairman Terry Gou said Monday the key to his company's deal with Sharp is not the price at which he buys a stake in the Japanese company but how the two companies will work together so that both parties benefit. The head of the world's biggest contract electronics maker arrived in Tokyo Monday to renegotiate the price of a nearly 10 percent stake in Sharp bought by his Taiwan-based company in March. Gou insisted at a press conference, however, that the main focus of discussions this week would not be the acquisition price but how the two companies could cooperate and use each others strengths to defeat "a certain brand." He described the decision to acquire a stake and partner with Sharp as simply a microcosm of broader Taiwan-Japan cooperation and said it signified a successful example of something worth promoting, and was not a question of the deal's price. In March, Hon Hai Precision and three affiliates agreed to buy a 9.871 percent stake in Sharp for about US$800 million, or 550 yen (US$7.01) per share.
But the two firms reopened talks this month after Sharp's shares fell by over 60 percent from the agreed purchase price amid concerns over the Japanese company's earnings outlook. On Monday, shares of Sharp closed at 197 yen in Tokyo. Asked about a potential new deal, Gou said he couldn't say anything about it before meeting with Sharp's decision-makers. Japan's Yomiuri newspaper reported Monday that Sharp would maintain the lower-than-10-percent plan, citing Sharp President Takashi Okuda. (By Yang Ming-chu, Tsao Heng, Chung Jung-fen and Elizabeth Hsu)