Foxconn asks banks for compromises to make Sharp takeover deal work
Apple's biggest manufacturing partner, Foxconn, is angling for compromises from two key lenders before it goes ahead with its planned takeover of Sharp, a report said on Tuesday.
The company wants Mizuho Bank and Bank of Tokyo-Mitsubishi UFJ to provide Sharp with financial help should some potential liabilities arise, according to Japan's Nikkei. Foxconn is also said to be proposing that Sharp shares held by the banks be bought at a value below the originally suggested 100 billion yen, or $879 million.
Sharp president Kozo Takahashi is said to have met with Foxconn chairman Terry Gou on Monday, in a sign that a deal is still progressing despite delays. Some Nikkei sources anticipate an agreement later this week.
Foxconn was originally expected to complete the Sharp acquisition in late February, but suddenly postponed the deal after reportedly discovering undisclosed liabilities totalling 300 billion yen ($2.7 billion). Those were later suggested to be simply "worst-case" risks, rather than firm obligations.
Absorbing Sharp could further strengthen Foxconn's relationship with Apple, allowing it to sell display panels and not just assembly services. Apple might potentially be inclined to accept higher order prices in exchange for the convenience of the arrangement, and the chance to divert display business from chief rival Samsung.