Taipei, Dec. 5, 2012 (CENS)--Hon Hai Precision will continue its talk with Sharp for shareholding investment in the latter, despite announcement by Sharp to accept 9.9 billion Japanese yen of fund from Qualcomm, the world's largest mobile-phone chipmaker, said a ranking official of Hon Hai, who refused to be identified, yesterday (Dec. 4).
The official stressed that the investment of Qualcomm in Sharp has no relationship with Hon Hai's plan of buying into Sharp. In addition, Hon Hai will continue considering to purchase TV plants under the auspices of Sharp, according to the official.
The official made the remark in response to the publication of the strategic alliance between Sharp and Qualcomm yesterday, which will enable Qualcomm to own 5% stake in Sharp and become its largest shareholder. Hsin Chih-ping, Hon Hai spokesman, however, refused to comment on the news yesterday.
In March this year, Hon Hai reached an agreement with Sharp for investing US$800 million in the latter, in exchange for 9.9% stake in Sharp. Subsequently, Sharp's share prices plunged, prompting Hon Hai to negotiate with Sharp again for the investment plan. Due to the deferral of the plan, Sharp sought to obtain fresh funds from other sources. In addition to Qualcomm, the company is also reportedly talking with Intel and Dell for fund injection. Share price of Sharp advanced 2 Japanese yen, or 1.16%, closing at 174 yen yesterday.
Institutional investors pointed out that injection of 9.9 billion yen of fund by Qualcomm cannot solve the financial problem of Sharp, which is expected to suffer staggering deficit of 450 billion Japanese yen (NT$160 billion) this year. As a result, Sharp will continue to seek fresh funding sources, including Hon Hai.
