Report: Intel in talks to invest up to $US500 million in Sharp
- 13 November, 2012 15:36
Intel is in final negotiations to invest up to $us500 million in struggling Sharp of Japan, Kyodo News agency reported Tuesday.
Japan's largest news agency said the companies were discussing an investment of between ¥30 billion and ¥40 billion. It reported Sharp is also negotiating with Qualcomm, the U.S. maker of chips and components for mobile devices.
Sharp, in the midst of a restructuring and facing $5.6 billion in losses this fiscal year, warned earlier this month that it may not survive if it can't turn around its business or secure outside investment. While the company has massive cash flow problems and has been assigned junk status by rating agencies, it still possesses cutting-edge LCD technologies and some of the largest display factories in the world.
The Osaka-based company is in ongoing negotiations with Foxconn parent Hon Hai, after an investment deal agreed to earlier this year was shelved when Sharp's stock price plunged. While Sharp's negotiating position weakens along with its financial situation and sagging stock price, adding more bidders to the mix could motivate potential investors.
Sharp is suffering from investing too much on large-screen LCD panels for TVs, and is rushing to switch over to making screens for the booming tablet and smartphone market. The company also makes its own phones and tablets, which it sells mainly in Japan, and a wide range of consumer electronics and appliances.
The company has begun mass producing small screens for mobile devices using its IGZO technology, which uses far less power than existing technologies. Named after the indium gallium zinc oxide semiconductor on which they are based, the screens will be used in several upcoming Sharp devices, and the company has said it expects them to become a core product.
Officials at Sharp were not available for comment late Tuesday in Japan. The latest report from Kyodo, however, comes two months after Sharp denied earlier articles that it was in talks with Intel, saying flatly "there is no truth to the reports."
"It is pure speculation, we don't comment on rumors," said Chuck Mulloy, an Intel spokesman.
Japanese media have also linked Sharp to deep-pocketed Apple, for which it is a major supplier of displays.
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