Japanese giant Sharp (IW 1000/115) on Wednesday announced a $111 million capital injection deal with South Korean rival Samsung, underscoring the fading fortunes of Japan's electronics sector.

Sharp, which is scrambling to repair its battered balance sheet, said Samsung (IW 1000/15) would buy 10.4 billion yen ($111 million) worth of new shares, or a 3% stake in the Japanese firm.

Sharp said it has been supplying Samsung with liquid crystal display panels. In its news release, Sharp reported the capital infusion would be used to introduce new LCD technologies with high-definition features, and for investment and rationalization of manufacturing facilities for LCDs used in mobile devices.

Copyright Agence France-Presse, 2013; IndustryWeek contributed to this report