Japanese electronics giant Sharp said on Friday that it’s in talks with several companies regarding its LCD business, as the firm is under intense pressure from banks to find a partner for the loss-making division.
Sharp received a $1.7 billion rescue package in May this year, the second in the last three years, but ongoing losses have meant it is struggling to make the future investments in order to stay competitive.
The company’s lenders want it to find a buyer for at least part of the LCD division in the next few months.
“I cannot provide any names, but we are currently in negotiations with multiple companies”, Chief Executive Kozo Takahashi said at an earnings call, adding also that he could not say when any such deal might be finalised.
Hon Hai Precision Industry Co of Taiwan has said it is interested in buying some or all of the LCD division, while a state fund is also considering an investment in Sharp or to merge the LCD unit with Japan Display Inc, according to sources.
Sharp’s last quarter operating profit fell 86% to 3.5 billion yen ($29 million) from the year-ago quarter, mainly due to falling smartphone display prices.
The LCD division itself suffered an operating loss of 12.7 billion yen in the quarter, but was forecast to post a loss of 30 billion yen compared with an earlier estimate of a 45 billion yen profit.
Larry Banks is a keen follower of technology and finance. He has worked for a variety of online publications, writing about a diverse range of topics including mobile networks, patents, and Internet video delivery technologies.