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Innovation still undecided on Sharp rescue plans as Foxconn raises bid, tries to allay job fears

In the bidding war for Sharp, Innovation Network Corp. has yet to decide on a possible rescue plan, even as rival Foxconn is raising its bid and promising not to cut Japanese jobs, a report said on Friday.

Innovation — a fund backed by the Japanese government — was expected to come up with a bailout plan on Friday, according to Reuters, but executive director Tetsuya Hamabe told reporters that "no formal decision" had been made after a meeting of the fund's upper echelons. Sources told Reuters that the group has been considering injecting over 300 billion yen ($1.7 billion) into Sharp, which would be paired with another 350 billion yen ($2.9 billion) in assistance from the company's two principal lenders.

Foxconn, meanwhile, has reportedly raised its bid from 625 billion yen (about $5.2 billion) to 659 billion ($5.4 billion). The claim that it won't cut jobs is presumably a means of appealing to leaders in Japanese government and industry worried about the damage a foreign takeover could cause.

As recently as Wednesday, Sharp was said to be leaning towards Innovation despite its nominally lower bid.

Whatever the outcome, the resulting entity will end up having Apple as a major client. Foxconn is Apple's main assembly partner, while Innovation would likely merge Sharp's display unit into Japan Display, an Apple supplier it formed out of parts of Sony, Toshiba, and Hitachi.