Taiwan’s Hon Hai to decide on Sharp investment within week

Responding to a question whether Foxconn would walk out of bidding as the victor, Gou reportedly said; “Yes, I am very confident”.

Taiwan’s Hon Hai Precision Industry Co (2317.TW) said on Sunday that it was confident of its offer for Sharp Corp (6753.T) and expected the struggling Japanese electronics maker to come to a decision on the issue within the week.

Hon Hai’s rival in the bid for Sharp, a Japanese state-backed fund, said on Friday it had yet to decide on its potential rescue plan for Sharp.

Despite voicing optimism about his company’s prospects, Gou cautioned that the global economy in 2016, the Year of the Monkey, may see “countless changes” just like the Monkey King – a reference to the classical Chinese fictional character Sun Wukong, who is capable of taking on 72 different forms. “We don’t want to destroy this company, we want to keep it”.

INCJ is planning to spin off Sharp’s LCD division and allocate to the new entity ¥10 billion out of the ¥30 billion investment, the sources said.

Chia-Peng Day, general manager of the company’s automation technology development committee, told the Global Times in July 2015 that Foxconn had decided in recent years to pursue automation to cut labor costs and boost its manufacturing process.

Foxconn has also offered to buy 225 billion yen worth of preferred shares held by Sharp’s two main banks, Mitsubishi UFJ Financial Group Inc 8306.T and Mizuho Financial Group Inc 8411.T , people familiar with the matter told the Journal. It was unclear from the Nikkei report how INCJ would proceed with such a solar merger. Following the meetings, Sharp and its bankers were leaning toward INCJ’s $2.5 billion bailout offer, the Nikkei Asian Review reported Sunday.

Solar Frontier is a wholly owned unit of Showa Shell Sekiyu KK. According to the Yomiuri newspaper, Foxconn Chairman Terry Gou was among those to meet with Sharp’s management at the company’s headquarters.

Sharp’s American depositary receipt rose as much as 13.4 per cent to $1.27 and closed at $1.25 on Friday. Profit margins expanded because of automation, he said.