It’s confirmed! Foxconn and Sharp have finally approved plans for the Taiwanese company to buy the struggling Japanese firm. The deal, which has a closing price of $6.2 billion USD, has been reduced to $3.5 billion USD or 388 billion JPY, about $2.5 billion less than the original amount.
The acquisition has been a big deal, as it marks the biggest ever by an overseas company in Japan’s technology sector, which is also the first of its kind. The Japanese consumer electronics giant has been struggling for quite a while amidst increasing pressure from competitors on both consumer electronics and display panel industry, reports Digital Trends.
Negotiations between the two companies have been ongoing for months. It has once reached a decision and was supposed to be sealed last month until the Taiwanese Electronics Assembler stalled in the last minute. It made quite the buzz as the public scramble to find the truth behind the almost-sealed deal gone awry.
Reports say the Taiwanese firm was concerned about the company’s recent performance and viability. Others say that it has found out that there are several undisclosed liabilities. It was later on clarified by the Taiwanese company that it wants to wait before signing the deal until it clarifies the new information it managed to obtain.
And it seems like issues have been clarified, which resulted to the latest announcement. Both companies are expected to exchange signatures this April 2 in Osaka, Japan. Once completed, Foxconn will end up with 66 percent controlling stake in Sharp.
The deal, once completed, is strategic for the Taiwan-based firm, as it will boost the company’s capabilities by adding Sharp’s technology, particularly its much revered low-power display business. It could help Foxconn increase leverage and business, adds Tech Crunch. The deal might also be sweet for Foxconn’s big boss, as it could be recalled that he has failed in a former Sharp investment bid in 2010.
The Taiwan-based company CEO and founder Terry Gou has expressed his feelings regarding the deal, saying, “I am thrilled by the prospects for this strategic alliance and I look forward to working with everyone at Sharp. We have much that we want to achieve and I am confident that we will unlock Sharp’s true potential and together reach great heights.”
Meanwhile, Sharp’s president and CEO Kozo Takahashi said that the move was to combine forces and “accelerate innovation.” Both companies also released a joint statement during a news conference in Taipei, saying that the takeover was a bid to revive the Japanese electronics firm’s flagging fortune, calling it a “historic strategic alliance.”
The statement also says that the companies 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,” reports Gadgets 360.
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