Foxconn Wins Fight for Sharp in $3.5B Takeover
The purchase price is lower than Foxconn's previous $4.4 billion offer after Sharp was found to have substantial future financial liabilities.
Foxconn is finalizing its takeover of consumer products maker Sharp in a $3.5 billion deal that the electronics parts maker has been pursuing for several years. The deal, which will help Foxconn expand into the display production market, will be signed on April 2, according to a March 30 story by The Wall Street Journal. The boards of both companies have approved the transaction, which comes at a sale price that is lower than Foxconn's previous $4.4 billion offer in February. Foxconn "has been looking to expand in the market for next-generation displays with its pursuit of Sharp," which supplies smartphone screens to Apple, the story reported. "Foxconn believes acquiring Sharp will allow it to move up the technology value chain by making smartphone screens, which are the most expensive components in mobile devices." "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," Terry Gou, Foxconn's chairman, said in a statement.
Following the acquisition, Foxconn "plans to invest in Sharp to expand its screen production capacity, including investing in a new type of display technology known as organic light emitting diode, or OLED," the Journal reported. "Apple is expected to use the technology in future iPhones, according to people familiar with the matter. Sharp said it would spend two-thirds of what Foxconn plans to invest in the company to beef up its panel manufacturing technology."