Tue, Sep 25, 2012 - Page 14 News List

Sharp gives revival plan, with job cuts, to lenders: Kyodo

Bloomberg

Sharp Corp, the Japanese electronics maker renegotiating a stake sale to Hon Hai Group (鴻海集團), presented a revival plan to lenders yesterday that includes job cuts, Kyodo News said.

Mizuho Financial Group Inc and Mitsubishi UFJ Financial Group Inc, Sharp’s two main banks, will study the proposal and decide by Sunday on a possible financing plan for the Osaka-based electronics maker, Kyodo reported, without citing anyone.

Resona Holdings Inc and Nippon Life Insurance Co may join in providing a total of about ¥360 billion (US$4.6 billion) in loans, the report said.

Restructuring measures in the plan include job cuts and payroll reductions, Kyodo said.

The electronics maker has been renegotiating terms for a proposed stake sale to Taipei-based Hon Hai after widening its full-year loss forecast eightfold last month, triggering a slide in its share price.

Hon Hai agreed in March to invest ¥67 billion for a 9.9 percent stake in Sharp at ¥550 a share.

Sharp fell 2.8 percent to close at ¥206 in Tokyo. The shares have declined 69 percent this year, making it the biggest percentage loser among more than 1,600 companies in the MSCI World Index.

The company had ¥706 billion of short-term debt maturing within 12 months and ¥314 billion in long-term debts at the end of June, according to its latest quarterly financial statement. Sharp’s cash and near-cash stood at ¥218 billion at the time.

Sharp plans to return to profit next fiscal year with the help of job cuts and cost reductions, company’s president Takashi Okuda said on Sept. 14.

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