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Hon Hai renews efforts to woo Sharp: report

Hon Hai renews efforts to woo Sharp: report

Taipei, March 20 (CNA) Japan's weekly business publication Toyo Keizai on Friday suggested on its website that two years after a falling out between Hon Hai Precision Industry Co. (??) and Sharp Corp., the Taiwanese electronics manufacturer now intends to begin anew its efforts to acquire a stake in the Japanese company. Toyo Keizai's March 13 website entry showed photos of Hon Hai Chairman Terry Gou (???) that were taken during an interview in Shenzhen, China on March 13. The story will be published in Toyo Keizai's upcoming new issue on March 23. According to the report, Gou intends to make an updated offer to Bank of Tokyo-Mitsubishi UFJ, and Mizuho Bank, the two main banks backing the bailout of Sharp's ailing performance. Toyo Keizai suggested that its upcoming front-page story will be focused on Sharp's reactions to Hon Hai's "love call." In July of 2012, Gou in his personal capacity acquired a 50 percent stake in Sharp's 10th-generation display panel plant situated in Sakai, a city in Osaka Prefecture, at the cost of 66 billion yen (US$546.5 million). The two companies, however, could not agree on the terms under which Hon Hai would acquire a 9.9 stake in the overall company Sharp. According to the report, Hon Hai is expected to resume wooing Sharp as early as before the end of this month, ahead of the expiration of a previously established contract between the companies allowing for a three-year time frame for their union. The report said that following its fallout with Hon Hai, Sharp had sought backing from Tokyo-Mitsubishi UFJ and Mizuho Bank, provided that the ailing company meets medium-term operating goals set for the two-year period between 2013 and 2015. Sharp's poor performance, however, continued to worsen in 2014, and failed to live up to expectations of a profitable year as sales waned for its LCD TVs and LCD display panels to record losses of 30 billion yen. It is also growing unlikely for Sharp to achieve the projected profits of 80 billion yen in fiscal year 2015, which ends on March 2016. Meanwhile, Gou said through a statement that his investments in Sharp are aimed at gaining a role in the Japanese firm's management, and achieving other win-win situations for both parties, such as cross-licensing and the transferal of patented technologies. Hon Hai also said that in order to boost morale, Gou has distributed his share of the profit from the Sakai plant among employees working there. The Taiwanese electronics contract manufacturing giant said that they hope to use precedents in Sakai as hallmarks of collaborating with Hon Hai. (By Jackson Chang, Yang Ming-chu and Ted Chen)


Updated : 2020-11-30 03:57 GMT+08:00