Skip to Content

Sharp’s Price Tag Just Got Cut Again by iPhone and Playstation Maker

Tour Of The Foxconn Complex And Interview With CEO Terry GuoTour Of The Foxconn Complex And Interview With CEO Terry Guo
Terry Gou, chairman and president of Hon Hai Precision Industry (aka Foxconn), speaks at the product testing facility on the Foxconn City complex in Shenzhen, China.Photograph by Thomas Lee — Bloomberg via Getty Images

Troubled Japanese tech giant Sharp was once one of the greats, bid on by several international companies due to its status as one of the top TV and consumer electronics sellers in the world.

But now Sharp is facing a price cut that may slash a minimum of $2.16 billion off its takeover deal with Taiwan-based tech titan, Foxconn, people familiar with the matter told the Wall Street Journal. It’s the latest episode in a series of hurdles for the two companies, which have weathered several delays and a nightmarish last-minute revelation from Sharp that it had about $3.1 billion in potential contingent liabilities in late February.

Now, after sending hundreds of people to review Sharp over the course of a month, Foxconn is likely to pay $3.4 billion to buy a two-thirds stake, down from the $4.4 billion it initially offered. That’s due to issues with Chinese sales and factory overcapacity, the Journal continued.

The boards of Sharp and Foxconn, more formally known as Hon Hai Precision Industry Co., are set to meet separately on Wednesday to review the deal, which could still evolve, the Journal reported.


As part of the original offering, Foxconn planned to buy some of Sharp’s preferred shares held by the Japanese company’s two main creditors, the Bank of Tokyo-Mitsubishi UFJ and Mizuho Bank, for $886.5 million. Now, those two banks are also extending a credit line to Sharp worth $2.7 billion as part of the new deal.

Foxconn, whose biggest business is as a contract manufacturer that has made iPads, Kindles, PlayStations and more, would get the chance to break into the consumer tech business under its own brand. Moreover, Foxconn CEO Terry Gou has said that he plans to revive the troubled Sharp company rather than break it up, the Wall Street Journal reported.

The announcement regarding a deal agreement could come as early as Saturday, people familiar with the matter told the Journal.