Japan government aim to beat Foxconn to $5.1bn Sharp takeover

Naturally, Japanese officials are expressing concern over letting one of its major tech manufacturing companies fall under foreign control, but Foxconn clearly wants to consolidate the services it offers as Sharp is a display maker of some note.

Industry minister Motoo Hayashi said that “Japan’s technology is leading the rest of the world and we would like to help make it even more competitive”.

A decision to accept or reject the bid is expected before the end of January, the source said, asking not to be identified as the discussions are private.

Citing people familiar with the matter, the WSJ said that Foxconn’s debt undertaking was created to persuade Sharp’s creditors to favor its offer regardless of the political considerations. The company now owes $4.4 billion debt repayments to Japanese companies, including Mitsubishi UFJ Financial Group Inc., that must be disbursed by March 2016. The offer far exceeds a 300 yen bid previously made for the company by a Japanese government-sponsored investment firm. INCJ couldn’t immediately be reached for comment.

When asked about the reported big, a Foxconn spokesperson told CNBC that the company did not comment on market rumor or speculation. At the same time, Foxconn agreed to buy a 10% stake in Sharp, but that deal unraveled in 2013 after dismal earnings reports sent Sharp’s shares plunging.

Foxconn is the contract manufacturer that is known for assembling the Apple iPhone as well as other well known devices.

Meanwhile, Sharp could receive more business for LED displays and OLED in the future from Foxconn’s partners such as Apple, Amazon, and Xiaomi Corp. – all of whom utilize Foxconn’s product assembly facilities.