Bloomberg News

Sharp Shares Untraded, Bid at Limit in Tokyo After Foxconn Deal

March 27, 2012

Sharp (6753) Corp. shares were bid at their daily limit in Tokyo after Foxconn Technology Group (FOXCGZ) and founder Terry Gou agreed to invest 133 billion yen ($1.6 billion) in the TV maker and its display unit to secure flat panels.

The shares weren’t traded and bid at 570 yen as of 9:49 a.m. in Tokyo, compared with yesterday’s closing price of 495 yen. Buy bids outnumbered sell offers about 4-to-1 after Foxconn agreed to pay an 11 percent premium to buy the stock.

The deal, announced after the stock markets closed yesterday, is the largest Japanese investment by a Taiwanese buyer and includes an agreement to purchase as much as 50 percent of Sharp Display Products Corp.’s LCD panels. Sharp (6753), which last month forecast a record 290 billion-yen loss for the fiscal year as TV prices dropped, may begin supplying panels for Apple’s iPad next month, according to researcher IHS Inc.

“They are in trouble and their very survival is at stake,” Edwin Merner, president of Tokyo-based Atlantis Investment Research, which manages $300 million, said about Sharp. “Maybe the tie-up will help.”

Foxconn entities will buy 121.65 million new shares in Sharp for 550 yen each, according to Sharp’s statement. Sharp shares closed at 495 yen in Tokyo yesterday before the announcement.

To contact the reporter on this story: Naoko Fujimura in Tokyo at nfujimura@bloomberg.net.

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net.


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