Tag: sharp

Sharp sees first profit in two years

sharp2Sharp posted its first quarterly net profit in over two years as the Japanese LCD maker pressed ahead with cost-cutting measures under its new Foxconn owners.

Sharp raised its operating profit forecast to $329.85 million for the year ending in March from an earlier forecast of $227 million.

Net profit was $37,136,400 for October-December, compared with a $218,348,000 loss in the same period a year earlier. It was the first profit on a net basis since July-September 2014.

The return to profit comes as Sharp uses Foxconn’s mighty parts procurement power, reviewed the lineup of products and implemented various measures to cut fixed costs.

Sharp also benefited as production cutbacks by Korean rivals in LCD panels for television sets fuelled an industry-wide shortage of panels and pushed up market prices.

Its core display device unit posted an operating profit of 11 billion yen, against a 11 billion yen loss a year prior, swinging back to profit for the first time in two years.

 

Sharp rethinks foreign brand licensing deals

sharp2Troubled Japanese telly maker Sharp is having a rethink of its  TV brand licensing deals overseas in an effort to boost its global presence now it is ruled by the glorious Foxconn empire.

In a statement the company said it had decided to review our current brand licensing business in Europe and Americas, and are currently examining various possibilities.

The comment follows a report by the Yomiuri newspaper that Sharp will dispatch officials next month for negotiations to buy back its TV business in the United States and Europe.

Sharp effectively exited the money-losing TV business in those markets and licensed its brand to China’s Hisense Group in the Americas and to Universal Media Corp Slovakia in Europe.

The withdrawal from the money-losing TV business abroad helped Sharp trim its losses in April-June.

But Sharp now believes that it can make profits out of the TV business by taking advantage of Foxconn’s procurement power in the supply chain and its vast network of clients, the Yomiuri said.

 

Panasonic packs in LCD panels

panasonicPanasonic has given up making LCD panels for televisions because the price competition.

The pullout from TV LCD manufacturing follows the company’s withdrawal from plasma TV production three years ago.

Panasonic has been making liquid crystal display panels for TVs at its Himeji factory in western Japan since 2010. Company executives are now planning to end production of the parts by September.

It  says it will continue to manufacture LCD panels at the plant for products other than televisions, such as medical equipment and cars.

But it says cuts in output will lead to transfer of hundreds of workers to other factories or offices, out of about 1,000 currently employed at the plant.

However it says ir will keep making Panasonic-brand televisions, using panels supplied by other manufacturers.
The move leaves Sharp and its Taiwanese parent firm Hon Hai as the only producer in the land of the Rising Sun.
Panasonic said that its executives are trying to streamline operations to focus more on profit, rather than scale of sales.

Sharp and Foxconn deal will go through

sharp2Sharp and Foxconn are set to sign a takeover deal next week after repeated delays.

Word on the street is that the two sides are set to agree on a smaller bailout than originally planned for the troubled Japanese outfit.

The two companies will hold board meetings on Wednesday to approve the deal and officially sign a deal the following day.  Of course both sides are officially saying nothing.

The companies were close to signing a deal last month but Foxconn hit the pause button after discovering there were some liabilities that no one had warned it about before.

The deal is set to be the largest acquisition by a foreign company in Japan’s insular technology sector.

The Tame Apple Press is focusing on the fact that it will boost Foxconn’s position as Apple’s main contract manufacturer and provide Sharp with funds to start mass-producing organic light-emitting diode (OLED) screens by 2018, around the time Apple will claim to have invented the technology for its iPhones.

 

Foxconn presses ahead with Sharp buyout

sharp2Although it seemed the deal was on the rocks, Foxconn has completed its due diligence into Sharp, but is seeking guidance from the loss making electronics maker on its latest quarterly performance.

Foxconn appears close to finalising a takeover of Sharp, estimated to worth nearly $6 billion and marking the largest purchase of a Japanese tech firm by a foreign company.

The deal may not happen this week as both outfits were working hard to reach a satisfactory agreement as soon as practically possible and have not set a signing date.

Investors are edge about the deal’s prospects after a last-minute hitch  over potential liabilities at Sharp and the display maker’s shares slid 9 percent on Wednesday.

Foxconn, the world’s largest contract maker of electronic goods and a major supplier to Apple is waiting for auditors and accountants of Sharp to confirm whether the liabilities it has uncovered in its due diligence through the end of 2015 are correct.

It is also seeking guidance from Sharp’s team about its latest quarterly performance, the person said.

In early February, Sharp said it expected an operating profit of$88 million for the year ending in March.

 

Sharp and Foxconn are in the War of the Roses

WarRoses1989Foxconn and Sharp,  which are supposed to be tying the knot, are already feuding like the divorcing couple in the War of the Roses.

The pair have been eyeing each other up since Foxconn founder and billionaire Terry Gou pulled out of a planned capital tie-up and strategic partnership with Sharp in 2012.

But it got silly last week. Sharp’s board met and announced a decision to sell a two-thirds stake to the Taiwanese group which upset Gou.

On the eve of that board meeting, Foxconn had asked Sharp to delay voting on a deal as it had just received “new material information” from Sharp that it hadn’t seen before and needed to clarify.

However Sharp appears to have ignored Foxconn and agreed to the deal anyway. To make matters worse it then made the deal public.

The information Foxconn was worried about was $2.66 billion in contingent liabilities at Sharp. The list was pulled together by working level officials at Sharp and forwarded, without top officials seeing it, to Foxconn as a goodwill gesture to make the buyer aware of worst-case scenario risks.

Foxconn said it “felt violated” and Gou shouted at his team for not having discovered these liabilities in the first place.

The mood has calmed again after the two companies’ CEOs met in China to clear the air. They have now agreed to extend a deadline for the takeover talks by a week or two, reflecting the importance of a deal estimated to be worth nearly $6 billion.

The suspicion appears to be based on distrust from four years ago, when Foxconn agreed to take a stake in Sharp. Then, Sharp warned of losses, and Foxconn walked away. Sharp shares sank 74 percent over the next seven months.

Gou personally bought a stake in Sharp’s LCD TV panel plant in Osaka, and some at Sharp credit him with improving operations there. He then presented a takeover plan on January 30 which could save Sharp.

However there is still some doubts whether Hon Hai will really keep its promise and there are doubts if Taiwan can respect the Japanese way of doing business. After all the traditional way does seem to get rather a lot of debts in this case.

Foxconn and Sharp deal already in trouble

sharp2Hours after it was announced, Foxconn’s plans to buy Sharp are already in trouble.

Sharp CEO Kozo Takahashi and Foxconn Chief Executive Terry Gou plan to meet today after the world’s largest contract maker of electronic goods put its takeover of the loss-making Japanese firm on hold.

Apparently the problem was previously undisclosed liabilities which Foxconn discovered when the deal went through. Foxconn said it would not sign the deal until it had clarified some “new material information” from Sharp. It did not elaborate.

One of the sources said Foxconn’s own due diligence had uncovered liabilities

A spokesman for Foxconn declined to comment on the issue. Sharp also declined to comment.

But the entire deal is in trouble according to analysts.

Shares in Sharp slid 15 percent this morning, adding to losses a day earlier as planned share dilution under the deal looked larger than expected. The stock has fallen 27 percent over the past two days.

The last minute hitch casts doubt on a deal that would have marked the conclusion to five years of courting by Gou and the opening up of Japan’s insular tech sector to foreign investment.

 

Foxconn buying Sharp for $5 billion

sharp2Foxconn is now only awaiting finalised details between the two parties, before buying the troubled Japanese display maker Sharp.

Foxconn’s lead zookeeper CEO Terry Gou said Foxconn has been given preferred negotiating rights, and is aiming to lock up a deal by the end of February.

The two companies are said to have reached a consensus on most matters, with what’s remaining being mostly legal and regulatory issues.

“The rest is a process…I don’t see a problem completing this process,” Gou said.

Sharp’s CEO Kozo Takahashi had previously denied that his company had given Foxconn exclusive negotiating rights. It’s not clear what changed to sway the situation.

Foxconn’s bid is believed to be worth at least $5 billion twice what the Japanese government was offering.

The Tame Apple Press thinks that if the Sharp deal is completed, it should further strengthen Foxconn’s links with Apple, giving it the ability to not just assemble Apple products like the iPhone but manufacture displays too. However it is unlikely that Foxconn would want to depend much more on Apple’s slowly failing business, it is more likely that it wants to take a bigger slice of smartphone and other mobile gadget production.

Foxconn wants to take the Sharp end

sharp2Foxconn Chief Executive Terry “The Zookeeper” Gou is in Osaka to meet executives of Japan’s Sharp.

The move comes a day after Sharp said it was focusing on the Taiwan firm’s takeover bid over a rival offer from a Japanese state-backed fund.

Foxconn wants to invest $5.6 billion in Sharp and Sharp’s board had voted 13-0 to negotiate with Foxconn instead of the state-backed Japanese fund, the Innovation Network Corp of Japan.

No one is saying anything until Gou addresses the media in a coming press conference.

A takeover by Foxconn, which assembles various electronics products such as smartphones and television sets for Apple, Sony Corp and many other major international companies, would vastly expand sales channels for Sharp’s liquid crystal display (LCD) panels.

While a generous Foxconn offer had been predicted, many investors in Japan were surprised to see an overseas firm gain the upper hand over a state fund.

The decision comes after months of uncertainty over the fate of the company, whose display panel business has continued to suffer massive losses despite two major bailouts by its banks in the last four years.

Foxconn offered $5.3 billion to buy Sharp

sharp2Foxconn wanted to get its foot in the door of the display business and offered $5.3 billion to buy the troubled Japanese outfit Sharp.

According to the Wall Street Journal said that while Sharp would be happy with the deal, Japanese officials are a little wary about it.  It would mean that the Japanese outfit will come under foreign control along with its display technology.

Industry minister Motoo Hayashi said that “Japan’s technology is leading the rest of the world and we would like to help make it even more competitive.”

In fact it has been suggested that banks are currently reviewing a competing offer from Innovation Network, a Japanese-government backed investment fund.