Hon Hai to meet press after board meeting as Sharp speculation swirls

GMT 08:03 2016 Wednesday ,30 March

Arab Today, arab today Hon Hai to meet press after board meeting as Sharp speculation swirls

Sharp chairman and CEO Kozo Takahashi (R)
Tokyo - AFP

Speculation swirled Wednesday that the boards of troubled Japanese electronics maker Sharp and Foxconn parent company Hon Hai are to imminently agree a multi-billion-dollar takeover by the Taiwanese company after a month of delays.

The deal would be the first foreign acquisition of a major Japanese electronics firm if the two companies sign the deal on Thursday as reported.

The Taiwan Stock Exchange said Wednesday that Hon Hai would hold a press conference to announce important information after a board meeting, but a Hon Hai spokeswoman refused to comment on speculation it will imminently sign the agreement with Sharp.

A spokesman for Sharp declined to comment on reports by Japanese public broadcaster NHK and other media that it would also hold a board meeting, saying the company could not reveal any details of board meetings.
The Osaka-based company is expected to give the greenlight to a proposal by Hon Hai to slash an originally agreed cash injection of 489 billion yen ($4.3 billion) by around 100 billion yen, NHK said.

Hon Hai is required by the exchange to hold a board meeting before submitting its annual report on March 31, but the spokeswoman dismissed as "market speculation" that the board would meet for the purpose of discussing Sharp.

The exchange earlier said that Hon Hai would hold a press conference if a major decision, such as one on Sharp, was reached.

Sharp decided in late February to accept Hon Hai's proposal but the Taiwanese multinational owner of Foxconn -- the world's biggest iPhone and iPad maker -- delayed the takeover to review new information the Japanese company had supplied.

Japanese media have said it involved potential liabilities topping 300 billion yen that Hon Hai would have to assume in a takeover.

The latest speculation comes as Hon Hai applied Tuesday for a halt in share trading, suggesting it is ready to finalise its takeover of Sharp.

The Taiwan Stock Exchange said trading in shares of Hon Hai Precision and its affiliate Foxconn Technology would be suspended due to a "major announcement".

Hon Hai was fined early this month after the exchange said the company violated trading rules by failing to fully explain the deal it has been negotiating with Sharp.

Sharp has teetered on the edge of bankruptcy for years and Foxconn's colourful billionaire owner Terry Gou has long been pushing for a takeover.

The two firms have worked together for years on large-screen technology, including for televisions, and jointly operate a liquid crystal display (LCD) panel plant in Japan.

Still, the Japanese government had reportedly been concerned about Sharp's key technologies falling into the hands of a foreign firm.

Sharp is still a leader in LCD technology and remains one of Japan's best-known corporate brands overseas despite its bleeding balance sheet.

But the century-old company piled up eye-watering losses after the 2008 global financial crisis and a restructuring plan has yet to pull it out of the red.


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