Sharp bags partners for LCD biz, forecasts bigger loss for 2011
May be handing over control of loss-making display plant
Sharp has found two new partners to help with its LCD factory as it forecasts an annual loss of ¥380bn ($4.7bn, £2.97bn).
The company's new forecast for the fiscal year to the end of March is up from a previously expected loss of ¥290bn ($3.57bn, £2.25bn). The full results will be reported later this month.
"We have adjusted our consolidated earnings forecasts in connection with delayed shipments of LCDs used for mobile devices" and restructuring costs, Sharp said in a canned statement in Japanese, reported by AFP.
The Japanese firm also said that it had bagged two more investors for its LCD business – Toppan Printing and Dai Nippon Printing.
Sharp recently got Hon Hai Precision, owners of Foxconn, to sink ¥66bn for a 46.5 per cent stake in its telly business, which is a joint venture with Sony. Hon Hai also handed over ¥66.9bn for a 9.9 per cent stake in Sharp itself.
Today, the company announced that Toppan and Dai Nippon would also be joining the venture, called Sharp Display Products, but didn't say how much cash the pair would be parting with or how large their stakes would be.
"The method of the business integration will be determined upon consultation among the parties to this business integration," Sharp said in another canned statement.
However, the resulting venture could end up moving out of Sharp's control. The firm said that "transfer of its subsidiary, SDP, is expected in connection with the business integration".
Sharp said that its share in the business could fall below 40 per cent, making Hon Hai the major shareholder.
The company's revised forecast, which would result in its largest ever loss, comes just after fellow Japanese electronics maker Sony announced its own revised loss expectations, coming in at 520bn.
The combination of recession-dampened appetite for consumer electronics, particularly TVs, the strong yen and rising competition from firms like Samsung has pushed Japanese firms into increasing losses. ®