Hon Hai Precision Industry Co (鴻海), the world’s largest contract electronics maker, has proposed to spend ￥300 billion (US$2.5 billion) to acquire financially struggling electronics firm Sharp Corp, according to Japan’s Kyodo news agency.
The report posted on Friday said that the proposed acquisition price is about 50 percent higher than the Japanese company’s current market value, indicating that Hon Hai wants to use the good offer to gain the upper hand and win consensus from the Japanese firm during acquisition negotiations.
According to the report, while Hon Hai — known as Foxconn Technology Group (富士康) outside Taiwan — has proposed acquiring Sharp at a high premium, it also wants Sharp’s current management team, including president and chief executive officer Kozo Takahashi, to step down.
Hon Hai would send a team to Sharp to manage the firm, the report said.
Hon Hai also plans to take over the debt shouldered by Sharp to help the firm address its financial problems, the report said.
However, the report also said that Hon Hai has yet to talk with Sharp’s bank creditors.
The report said that Sharp was shouldering about ￥760 billion in debt as of the end of September.
Hon Hai is not the only potential suitor seeking to buy Sharp, the report said, adding that the Innovation Network Corp of Japan (INCJ), which is sponsored by the Japanese government, is studying a buyout of Sharp.
The report said that the INCJ still needs some time to map out a concrete acquisition deal, and the proposal is unlikely to come out until next year, so Hon Hai is taking advantage of the vacuum created to make a deal.
According to the report, the INCJ is discussing whether it would spin off Sharp’s LCD production operations and then integrate the operations with the INCJ’s small and medium-sized flat-panel unit, Japan Display Inc (JDI).
The INCJ owns a 35 percent stake in JDI.
Although Hon Hai proposed spending ￥300 billion to acquire Sharp, the Kyodo report said that the Taiwanese firm’s previous proposal to raise its stake in Sharp’s flatscreen plant, Sakai Display Products Corp in Osaka’s Sakai City, is still valid.
In July 2012, Hon Hai chairman Terry Gou (郭台銘), in a personal capacity, acquired a 37.6 percent stake in the advanced display panel plant from Sharp, which now holds a 37.6 percent share.
Contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is expected to remain the third-largest IC supplier this year, unchanged from last year, IC Insights said yesterday. IC designer MediaTek Inc (聯發科) is expected to become the 11th-largest, up from 16th last year, the semiconductor market research firm said. TSMC is expected to post US$45.42 billion in sales, up 31 percent from last year, IC Insights said in a report released on its Web site. TSMC’s sales growth is largely due to a surge in orders from Apple Inc and HiSilicon Technologies Co (海思半導體) — two of its major clients — which
SETTING AN EXAMPLE: The commission suspended the bank’s two top executives as ‘a warning to all banks,’ while the fine is the biggest to be given to a bank in a single case The Financial Supervisory Commission (FSC) yesterday fined E.Sun Commercial Bank (玉山銀行) NT$20 million (US$693,698) over a theft scandal and punished the bank’s two top executives. A customer relationship manager surnamed Pan (潘) at the bank’s branch in Kaohsiung’s Fengshan District (鳳山) stole NT$140 million from 41 clients over the past seven years, the commission said. Pan secretly transferred the stolen money to accounts belonging to her and her family members by using clients’ debit cards, passwords or documents that were stamped using the clients’ personal stamps between July 2013 and June this year, the commission said. The commission suspended Ben Chen (陳炳良), the
HARD ASK: At a meeting held by the MOEA to talk about the RCEP trade deal, trade associations said that they expect the government to push for more free-trade deals Business representatives yesterday urged the government to slow the appreciation of the New Taiwan dollar, saying that some Taiwanese industries have been undercut by rivals due to unfavorable foreign exchange rates. The government should also assist local industries to expand their domestic market, and push for more bilateral trade deals so that Taiwanese companies can enjoy zero or preferential tariffs on exports, following the nation’s exclusion from the Regional Comprehensive Economic Partnership (RCEP) which was signed by 15 Asia-Pacific nations on Nov. 15, they said at a meeting with the Ministry of Economic Affairs (MOEA). Some participants said that the NT dollar’s
BREATH OF LIFE: The firm said the under-utilized plant should start mass production in the first quarter, timed to coincide with Intel Corp’s release of its Ice Lake server chip Hon Hai Precision Industry Co (鴻海精密) plans to assemble key components for Google servers at its plant in Wisconsin, people familiar with the matter said, finally breathing life into a factory that US President Donald Trump hailed as crucial to bringing manufacturing back to the US. The company has decided to locate production for this new contract at the existing complex rather than make the components at home or in China, the people said, asking not to be identified. The under-utilized plant should start mass production in the first quarter, timed with the release of Intel Corp’s Ice Lake server chips,