Cash-strapped Japanese electronics giant Sharp Corp said yesterday that a badly needed capital injection from US chipmaker Qualcomm Inc had been delayed as the two sides hammer out details of the pact.
Sharp in December last year announced it had struck a US$120 million deal with Qualcomm as it moves to repair its tattered balance sheet with the agreement calling for joint development of LCD screens for smartphones.
The US firm has paid about half of the investment, giving it a 2.64 percent stake in Sharp, with the second payment, which should be about US$60 million, scheduled for Friday next week.
“But it has become impossible to get the payment on March 29 ... with negotiations continuing on the terms of the second new share issuance,” Sharp said in a statement, without elaborating.
Qualcomm’s initial investment saw it buy Sharp shares at ￥164 each, about half of the ￥307 they finished at in Tokyo yesterday after falling 2.53 percent by the close.
A Sharp spokeswoman said the delay was not related to the share price of Sharp — which has apparently shelved a bigger capital deal with Taiwan’s Hon Hai Precision Industry Co (鴻海) — but rather questions over mass production of the energy-efficient displays.
She added that the delay would not impact Sharp’s earnings, and said the two sides had earlier agreed the second payment could be delayed by three months.
Earlier this month, the Osaka-based maker of Aquos brand electronics announced a ￥10.4 billion capital tie-up deal with South Korean rival Samsung Electronics Co, making it Sharp’s biggest foreign investor.
Separately, embattled Panasonic Corp plans to scale down its television business and withdraw from manufacturing plasma displays, a report said yesterday.
Under its mid-turn business plan to be announced on Thursday next week, Panasonic is set to significantly downsize its television business over a three-year period starting next fiscal year from next month, the business daily Nikkei reported.
Panasonic intends to halt production of TV plasma panels at its main plant in Amagasaki in western Japan, around fiscal 2014, and had already written off the value of production equipment at the three buildings there by fiscal 2011, the report said.
Jiji Press reported a similar story, while a separate report by the Yomiuri Shimbun said Panasonic is to withdraw from the healthcare business and sell its healthcare unit, as well as its buildings.
Panasonic said last month it logged a nine-month operating profit of ￥121.95 billion (US$1.29 billion), but weak demand for flat-panel televisions pushed total sales down 8.8 percent to ￥5.44 trillion, it added.
In a statement, Panasonic said nothing had been decided yet, but added that discussions on the business strategy were ongoing.