Wed, Dec 05, 2012 - Page 15 News List

Qualcomm set to buy 5% stake in Sharp, reports say


A man yesterday looks at Sharp Corp’s Aquos television sets displayed at an electronics store in Tokyo.

Photo: Reuters

Chipmaker Qualcomm Inc is set to buy about 5 percent of Sharp Corp, reports said yesterday, as the cash-strapped Japanese electronics giant looks for a capital injection to repair its balance sheet.

The ¥10 billion (US$122 million) investment by US-based Qualcomm comes as Sharp, mired in heavy losses, has also reportedly been talking with other US technology giants, including Intel Corp and Dell Inc, about a possible investment.

The Qualcomm deal would see the pair jointly develop energy-efficient LCD panels for smartphones using the Japanese firm’s technology, with the US company getting new Sharp shares equal to about 5 percent of its current market value, Jiji Press news agency reported.

The agreement calls for Qualcomm to invest about ¥5 billion in Sharp by the end of the year, with the other half invested as the joint venture progresses, the Nikkei Shimbun said.

News of the deal gave Sharp shares a boost in Tokyo where the embattled stock rose 1.2 percent to ¥174.

In a short statement yesterday morning, Sharp said: “Today’s reports about a US chipmaker’s investment in our company are not what we have announced.”

Sharp has suffered a series of credit rating downgrades and warned it expects to lose about US$5.6 billion in the fiscal year to March next year.

The Osaka-based maker of Aquos -brand electronics has announced thousands of job cuts while cutting wages for employees — from the factory floor to the executive boardroom — and selling real-estate to shore up its balance sheet.

Earlier this year, Sharp said it had reached a capital injection deal worth about US$800 million with Taiwan’s Hon Hai Precision Industry Co (鴻海精密), which makes Apple gadgets in China, but the deal stalled as Sharp’s share price nosedived.

This story has been viewed 2319 times.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top