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Japan’s Sharp accepts takeover, Foxconn not ready to sign

  • KYODO NEWS VIA ASSOCIATED PRESS

    Sharp President Kozo Takahashi, center, is surrounded by the media as he left the company’s Tokyo office in Tokyo, Thursday.

TOKYO >> Sharp Corp. announced Thursday it will accept a 489 billion yen ($4.4 billion) takeover by Taiwan’s Hon Hai Precision Industry Co., also known as Foxconn, but Foxconn said it was not ready to sign the deal.

“We will have to postpone any signing of a definitive agreement until we have arrived at a satisfactory understanding and resolution of the situation,” Foxconn Technology Group said in a statement.

It did not elaborate. If the deal goes through, Sharp would become the first major Japanese electronics maker to be acquired by a foreign company.

Foxconn is a major contractor to Apple Inc., assembling products such as iPhones.

Sharp chose Foxconn as its preferred partner in a two-day board meeting ending Thursday, and said Foxconn would gain a 66 percent stake in the company under the deal.

Sharp spokeswoman Nali Li said the company had no official comment on the statement from Foxconn.

It was unclear whether Foxconn was questioning the content of Sharp’s announcement, or just requesting more time to look at details.

Sharp had been considering both Foxconn’s bid and an offer from a Japanese government-backed consortium of Japanese investors.

Despite Japan’s rapid globalization, some have expressed fears a Foxconn takeover will result in the country losing technology to foreign interests.

Media reports in Japan that a deal might be imminent had sent Sharp share prices initially higher on the Tokyo Stock Exchange, but they finished 14 percent lower after details of the deal leaked. Sharp made the announcement after trading ended.

Osaka-based Sharp has long been a prized brand in Japan, beginning with its sale of mechanical pencils, still known as “sharp pencils” here. It also pioneered hand-held electronic devices.

Sharp had its beginnings as a Tokyo-based metalworking shop in 1912. It later made its fame with Aquos flat-panel TVs and nifty Internet-connecting cellphones, long before the arrival of iPhones in Japan.

But its finances deteriorated in recent years as prices of LCD panels dropped, and it could not beat competition from Asian rivals.

Analysts say Sharp’s future remains uncertain even with the takeover because of challenges in restructuring its consumer electronics operations.

Sharp suffered a 108 billion yen ($964 million) loss over the nine months through December. It has not released a full year profit or loss forecast.

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  • Who Cares!! They need to fix and clean up Fukushima!! And we got too many of them racists here in Hawaii. Wonder why our Hawaii government is dominated by their kind.

  • The glory days from the 70’s through the 90’s are gone for this electronic company with the emergence of the Korean and Chinese electronic juggernaughts with their superior business models, cheaper and controlled workforce costs. It is obvious that material cost are fixed by the nature of the technology, yet the variable is the most difficult to control absent a labor work force or automated technology to replace the labor force need to manufacture. During the mid 70’s an executive of Samsung predicted that they will oust Matsushita as the premier electronic manufacture. General Electric once ruled as the number one in this industry.

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