Foxconn offers €5.3 billion for majority stake in Sharp – update

Taiwanese Foxconn wants to acquire a majority stake in Japanese electronics company Sharp by acquiring 65.9 percent of the shares for 118 yen each. This means Foxconn offers 32 percent less per share than the Sharp share closed on Wednesday.

By acquiring Sharp, Foxconn aims to better compete with companies like Samsung that both produce and sell electronics to consumers. Foxconn’s total investment in the deal is more than 650 billion yen, which is about 5.3 billion euros, Reuters writes.

Sharp is one of the major suppliers of LCDs to Apple and wants to mass-produce OLED screens in 2018. Something special happens with the takeover, namely that a foreign company gains the upper hand in a Japanese company. Foxconn won the takeover battle of Innovation Network Corp, a partner in Japan Display joint venture. The Innovation Network Corp. is largely owned by the Japanese state.

With the acquisition, Sharp will not be incorporated into Foxconn, but will remain a separate company and will not replace the Japanese management. This step was allegedly made to appease the Japanese authorities.

Foxconn is the world’s largest manufacturer of electronics and produces products for numerous brands, including Apple, Sony, Microsoft and Amazon. With the acquisition of Sharp, it is conceivable that Foxconn itself wants to market its products under the Sharp brand name.

Update 10.56: Foxconn reports shortly after the announcement of the deal that the signing will be postponed. The company is said to have received “important new information,” but details were not disclosed. Sharp’s board of directors had already approved Foxconn’s offer, but shareholders still had to approve. Foxconn says it will postpone the signing until “the situation has been satisfactorily resolved.”