Industryweek 11690 Foxconn 1
Industryweek 11690 Foxconn 1
Industryweek 11690 Foxconn 1
Industryweek 11690 Foxconn 1
Industryweek 11690 Foxconn 1

Foxconn Gets Chinese Green Light for Sharp Deal

Aug. 12, 2016
Hon Hai gains Sharp's cutting-edge LCD panel technology with the $3.5-billion buyout, giving it a 66% controlling stake.

Taiwanese tech giant Hon Hai said antitrust authorities in China had approved its takeover of ailing Japanese electronics maker Sharp, clearing the last obstacle to the drawn-out deal.

The purchase, which was supposed to close last month, has reportedly been held up by China -- one of the countries that was reviewing the deal over concerns that it could lead to a monopoly on LCD screens.

Hon Hai gains Sharp's cutting-edge LCD panel technology with the $3.5-billion buyout, giving it a 66% controlling stake.

"Our application for antitrust review in various regions is completed," the company said in a statement to the Taiwan stock exchange on August 11.

Both sides will carry out the handover procedures as soon as possible according to the contract," it said.

The announcement fulfills an ambition of Hon Hai founder Terry Gou, whose firm first pursued Sharp four years ago.

Gou's company -- also known as Foxconn -- is the world's biggest electronics supplier, with Apple a key customer for smartphone components.

But the smartphone giant is squeezing its suppliers as sales of its iPhones slow, dropping 15% last quarter year-on-year.

Hon Hai shares slumped in Taipei Friday on weaker-than-expected quarterly earnings.

"From the results, we can see that Apple is pressuring its supply chain on prices," Fubon analysts led by Arthur Liao said in a note.

Hon Hai said on August 11 that its net profit dropped 31% to Tw$17.7 billion (US$565 million) in the April-June period, the third straight quarterly decline.

It missed the Tw$24.6 billion estimate by analysts polled by Bloomberg News.

Analysts are expecting better performance in the third quarter, when Apple's new iPhone 7 series is rumored to be launched.

Copyright Agence France-Presse, 2016

Popular Sponsored Recommendations

Empowering the Modern Workforce: The Power of Connected Worker Technologies

March 1, 2024
Explore real-world strategies to boost worker safety, collaboration, training, and productivity in manufacturing. Emphasizing Industry 4.0, we'll discuss digitalization and automation...

3 Best Practices to Create a Product-Centric Competitive Advantage with PRO.FILE PLM

Jan. 25, 2024
Gain insight on best practices and strategies you need to accelerate engineering change management and reduce time to market. Register now for your opportunity to accelerate your...

Transformative Capabilities for XaaS Models in Manufacturing

Feb. 14, 2024
The manufacturing sector is undergoing a pivotal shift toward "servitization," or enhancing product offerings with services and embracing a subscription model. This transition...

Shifting Your Business from Products to Service-Based Business Models: Generating Predictable Revenues

Oct. 27, 2023
Executive summary on a recent IndustryWeek-hosted webinar sponsored by SAP

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!