updated 08:14 pm EDT, Thu August 30, 2012
Foxconn could buy Sharp TV plants in China, Mexico
Hon Hai and Sharp are considering making a $1 billion investment in the latter's LCD plant in Sakai, Japan to help production of displays for Apple devices, Reuters reports. C.C. Lin, an official for Hon Hai -- better known as Foxconn -- made the interest public earlier this week. Lin suggests that Hon Hai is also considering buying Sharp's TV assembly factories in China and Mexico; as for the Japanese investment though, Reuters indicates that an arrangement could be announced as soon as Friday.
Both parties are reportedly still negotiating a deal that would give Hon Hai/Foxconn at least a 9.9 percent stake in Sharp. Lin comments that the outcome of talks is contingent on how much input Sharp would be willing to take on increasing profits. He hints moreover that if a deal is reached, it could lower Sharp's component prices. During the past year Hon Hai has been taking advantage of falling Sharp stocks; in March Foxconn was announced as buying a 10 percent stake in Sharp's LCD business.
Sharp is an existing LCD supplier for the iPhone and iPad, but could become more integral to Apple if it were able to boost production. The Hon Hai interest in Sharp's Chinese and Mexican facilities could support rumors that Apple is still working on a TV set, since Foxconn is Apple's main manufacturing partner. If so, however, production may still be some distance off.