Taiwan’s Hon Hai seals Sharp takeover for $3.5 bln

TAIPEI - Agence France-Presse

REUTERS photo

Taiwan’s tech giant Hon Hai said March 30 it had finally sealed a takeover of Japanese electronics maker Sharp in a “historic” deal worth 389 billion yen ($3.5 billion).

It is the first foreign acquisition of a major Japanese electronics firm and comes after weeks of delays, with Hon Hai buying a 66 percent controlling stake.

But the cash injection from Hon Hai-the multinational owner of Foxconn, the world’s biggest iPhone and iPad assembler- is well down from the original 489 billion yen put on the table in February.

Hon Hai put the brakes on the takeover last month, soon after it was first announced, to review new information from Sharp believed to relate to the company’s sizeable liabilities.

Hon Hai’s colorful founder Terry Gou said he was “thrilled” by the “strategic alliance.”

“We have much that we want to achieve and I am confident that we will unlock Sharp’s rue potential and together reach great heights,” he said in a joint statement.

Sharp’s president and CEO Kozo Takahashi added that the move would merge forces and “accelerate innovation.”

The joint statement, issued at a news conference in Taipei, described the takeover as an attempt to revive Sharp’s flagging fortunes and called it a “historic strategic alliance.”

“We are committed to restoring profitability and strengthening operations to once again make Sharp a leader in the global electronics arena and a world-class company with a positive outlook,” it said.

Hon Hai will pay 88 yen per share. A spokesman said the deal would be signed in Osaka on March 26.

The takeover must still be approved by Taiwan’s Investment Commission, which said it would rule on the acquisition within a month of receiving the application for the purchase.  
  
The deal is set to be the fourth largest overseas investment by a Taiwanese company, the commission reported.

Separately, Sharp warned on March 30 it expects an operating loss of 170 billion yen in the current fiscal year, reversing earlier expectations of a small profit.