Taiwan’s Foxconn to delay $4.3bn takeover of Sharp

0

A deal to take over Japanese electronics giant Sharp by Taiwanese manufacturer Foxconn, has been thrown into question by a last minute delay.

Foxconn said it had received new information from Sharp which needed to be clarified.

The news came hours after the announcement that the $4.3bn (£3.08bn) deal had been agreed.

Foxconn assembles most of the world’s iPhones. Sharp is one of Japan’s oldest technology firms.

Foxconn Technology Group said that Sharp had couriered over “new material information” to the management.

The Taiwanese company said in a statement: “We will have to postpone any signing of a definitive agreement until we have arrived at a satisfactory understanding and resolution of the situation,”

If the deal goes ahead, it would be the first foreign takeover of a major Japanese electronics firm in a historically insular technology sector.

Japanese officials had been reluctant to let Sharp fall under foreign ownership because of the distinctive technology behind its display panels.

Before the announcement of a deal with Foxconn, Sharp had been discussing a rival offer from a Japanese government-backed consortium of Japanese investors.

Founded in 1912, innovations by Sharp include a mechanical pencil in 1915 and pioneering developments in television engineering.

Although recent years have seen a downturn in its fortunes with heavy debts, the firm continued to be a leader in liquid display technology, a key asset for Foxconn.

The takeover plan involves Sharp, which employs more than 50,000 globally, issuing new shares to Hon Hai Precision Industry Co Ltd, which trades under the Foxconn name.

Sharp’s shares were halted from trading ahead the announcement. They later reopened and closed down by nearly 15%.

Technology specialists said the two companies were a logical fit.

“Sharp is strong in research and development, while Hon Hai knows how to market products to customers such as Apple, and it also has expertise in production. Together they can go global,” Yukihiko Nakata, a technology professor and former Sharp engineer told AFP news agency.

Share.

About Author

Leave A Reply