by Anton Shilov
12/03/2012 | 11:41 PM
As the situation with display and consumer electronics maker Sharp Corp. continues to remain uncertain, new rumours about possible resolutions emerge. According to a recent report, Qualcomm may acquire 5% stake in Sharp, which will make it one of the biggest shareholder in the company. However, the amount that Qualcomm is set to invest into Sharp will not be enough to save the company.
Qualcomm, the world’s largest supplier of application processors and system-on-chips for mobile devices, may invest as much as ¥10 billion ($121.5 million) into struggling Sharp, reports Reuters news-agency citing Nikkei news-paper. The transaction would give Qualcomm a 5% stake in Sharp and the two companies would then jointly develop a new-generation energy-efficient IGZO displays.
Sharp, which market capitalization has decreased by three times this year, is expected to lose ¥450 billion ($5.7 billion) this fiscal year, which means it badly needs money to survive. Back in November it transpired that Intel and Qualcomm were in talks to invest around ¥30 billion ($378 million) into Sharp.
Sharp had been projected to make Hon Hai Precision Industry (Foxconn Electronics) its largest stakeholder adding to an earlier contract to sell the Taiwan-based contract maker of electronics a stake in its cutting-edge television LCD panel plant in Sakai, Japan. That arrangement, nevertheless, unraveled as losses and mounting debt threatened to put Sharp out of business, forcing it to seek a $4.4 billion bank bailout. Talks with Foxconn since then have stalled.
Sharp, Qualcomm, Intel and Foxconn did not comment on the news-story.