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Sharp and Foxconn Reportedly Set to Sign Deal This Week

March 28, 2016 - Written By Tom Dawson

Big technology names out of Japan such as Panasonic, Sharp and Sony have been around for over a hundred years (in the case of Sharp, at least) and while they’ve adapted and become big players in the evolving tech industry, some of them have started to struggle. Where Panasonic is concerned, with a slowing TV business and a sluggish smartphone business only operating in parts of Asia and Sony’s PlayStation business is keeping their money coming in. Sharp Corporation meanwhile, the Japanese juggernaut that’s been going since 1912, has been struggling and a deal with Taiwan’s Foxconn – famous for putting together much of Apple’s portfolio – is rumored to be closer than ever to achieving a takeover for the company.

Sharp might be known by many as a high-profile manufacturer of TVs and the odd smartphone here and there, but in Japan the brand is a household name associated with the quirkier side of consumer electronics. For Foxconn, a takeover of Sharp could help be able to produce and sell products directly to consumers using the Sharp brand, rather than relying on other brands to make their money. The deal between the two has evolved over time and sources see Foxconn cutting their 489 billion yen ($4.3 billion) bid by as much as 100 billion yen. The newly issued shares in the company are how Foxconn hopes to take control of the company, and should the deal go through it would mark the biggest takeover of a Japanese technology firm by a foreign company.

While news of the reduced bid came through last week, word that the two were very close to sealing the deal came out over the weekend. Sharp chose to negotiate and work on a takeover deal with Foxconn instead of a government-backed fund, which could mark the first time that a Japanese technology company has become willing to become owned by a foreign company. Regardless of what happens next, this could have a big impact on the sector overall, and could help spur on growth in the technology sector throughout Asia. At the very least, it could help Foxconn become a more independent company, deciding what to make and what to sell itself, rather than just doing the work of other companies.