Feeds

Terrifying TV chimera born from Sharp, Foxconn lords' fling

Hon Hai spunks billions into struggling LCD biz

Beginner's guide to SSL certificates

Foxconn owner Hon Hai Group has given limping Sharp a crutch by buying a stake in the Japanese electronics maker and pouring a few billion yen into its LCD business.

Taiwanese Hon Hai will hand over ¥66.9bn ($806m, £507m) for a 9.9 per cent stake in Sharp - and will fork out another ¥66bn for a 46.5 per cent stake in the joint venture telly business Sharp has with Sony.

LCD shipments worldwide have slowed for everybody, but Sharp is also suffering, along with Sony and Panasonic, from a major kicking in the market by Korean electro-behemoth Samsung. Sharp forecasts a net loss of ¥290bn ($3.5bn, £2.19bn) for the year ending March 31.

"The market surrounding electronics industry is becoming severe, with rapid price decline due to the development of digital technology and increasing competition in a global market," Sharp said in a statement on the deal with Hon Hai. "We believe timely action is necessary to tackle these changes in the market."

Japanese trio Sharp, Sony and Panasonic are taking harder hits in the LCD sector because they have struggled to stay competitive as they battle against a strong yen.

Sharp said the partnership with Taiwanese Hon Hai would allow the LCD biz to "launch cost-competitive components and products that fit to market demand". Sourcing stuff from Hon Hai should help Sharp to bring its manufacturing costs down and price tellies more attractively.

Sharp also said today that Sony was sticking with the joint venture, named Sharp Display Products (SDP), for the moment, although it won't be injecting any more capital for now.

The venture, in which Sony holds about seven per cent of shares, was agreed in April 2011 and will be next reviewed this September.

Today's amendment to the deal stipulates that Sony can demand that Sharp buy back its stocks, even before that month, "upon the occurrence of certain events, such as a transfer by Sharp to any third party of some or all of the shares that Sharp has in SDP".

After the Hon Hai deal, Sony has its seven per cent, Sharp now holds 46.5 per cent and Hon Hai, its founder Terry Gou and other investment corporations now hold about 46.5 per cent. ®

Security for virtualized datacentres

More from The Register

next story
Facebook pays INFINITELY MORE UK corp tax than in 2012
Thanks for the £3k, Zuck. Doh! you're IN CREDIT. Guess not
Google Glassholes are UNDATEABLE – HP exec
You need an emotional connection, says touchy-feely MD... We can do that
Lawyers mobilise angry mob against Apple over alleged 2011 Macbook Pro crapness
We suffered 'random bouts of graphical distortion' - fanbois
Just don't blame Bono! Apple iTunes music sales PLUMMET
Cupertino revenue hit by cheapo downloads, says report
US court SHUTS DOWN 'scammers posing as Microsoft, Facebook support staff'
Netizens allegedly duped into paying for bogus tech advice
Feds seek potential 'second Snowden' gov doc leaker – report
Hang on, Ed wasn't here when we compiled THIS document
Verizon bankrolls tech news site, bans tech's biggest stories
No agenda here. Just don't ever mention Net neutrality or spying, ok?
Inside the EYE of the TORnado: From Navy spooks to Silk Road
It's hard enough to peel the onion, are you hard enough to eat the core?
prev story

Whitepapers

Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Top 5 reasons to deploy VMware with Tegile
Data demand and the rise of virtualization is challenging IT teams to deliver storage performance, scalability and capacity that can keep up, while maximizing efficiency.
Mitigating web security risk with SSL certificates
Web-based systems are essential tools for running business processes and delivering services to customers.