Foxconn reportedly plans to acquire Sharp’s LCD business

Foxconn Electronics, the world’s largest contract maker of electronics, is reportedly mulling to acquire LCD business from Sharp Corp. The company may even team up with Apple in order to take over Sharp’s display business. The move could help Foxconn to expand its business, whereas Apple will guarantee stable supply of low-cost screens it needs for its products.

Sharp has been losing money for several years and offloading its display business could help the company to return to profitability, reports DigiTimes. Foxconn and Sharp already produce displays in Sakai, Japan. The contract maker of electronics reportedly plans to acquire Sharp’s 38 per cent stake in the joint venture. In addition, Foxconn could acquire other display production operations from Sharp.

In a bid to fund the transaction, Foxconn can ask Apple for funding. Apple uses Sharp.’s displays for various devices, including iPad tablets. For example, the company’s latest iPad Pro uses Sharp’s IGZO display.

Sharp is also in talks with public-private Innovation Network of Japan, which is the main shareholder in rival Japan Display. If the two Japanese display makers merge, the new company could increase prices to Apple and other makers of various devices.

Sharp had recently accepted loans of JPY200 billion (US$1.68 billion) from collaborating banks and business-renewal organizations to improve its display business. As a result, the company may not need to sell its LCD operations just now.

Sharp and Foxconn did not comment on the news-story.

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KitGuru Says: It makes a great sense for Foxconn to acquire display operations from Sharp. On the other hand, for Japan Display it also makes a great sense to take over Sharp’s display manufacturing. It remains to be seen what happens next…

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