Foxconn wants Sharp’s LCD business

According to a report from Nikkei Asian Review, Apple manufacturing partner Foxconn has proposed to purchase Sharp’s LCD business.

EMS-giant Foxconn – or Hon Hai Precision Industry – is looking to get its hand on Sharp’s LCD business, which could prove to be an opportunity the Japanese company to rid riskfilled operations. The Taiwan-based company would not face the antitrust hurdle Japan Display would have to clear as a rival supplier of LCDs to Apple. Aside from the LCD operation, the Japanese maker has also announced its plans to sell the company’s headquarters and to withdraw from the television business in North America as well as to cut back its solar panel production. Foxconn’s proposal would limit Sharp’s risk while enabling it stay involved in the business.

Foxconn and Apple purchasing Sharp’s LCD business would mean that Apple wouldn’t have to worry about the fate of the company, which has been up in the air at several instances over the past few years.

But in July, he told reporters that Sharp’s losses, totaling 28.8 billion yen ($240.42 million) on an operating basis in April-June, meant it needed to consider more options.

The reported proposal came amid speculation that Sharp is in tie-up talks with the public-private Innovation Network Corporation of Japan, which is the top shareholder of rival Japan Display, the Nikkei said. At the same time, a marriage between Sharp and Japan Display could prevent key technology from being handed over to an overseas company.

Sharp said it could not yet comment on the report except to say it was “considering various options for the restructuring of the LCD business”. Spin-off talks with two major lenders this spring put its value around JPY 300 billion.

Sharp Corp will miss its first-half profit forecast and is poised to lower its target for the full year as rising competition among suppliers of liquid-crystal displays pushes down prices, a person familiar with the matter said.