With an aim to boost its finances Sharp Corp, a Japanese electronics company, is reportedly in talks with Lenovo Group Ltd to sell its LCD TV plant in China.
The move comes after the sudden drop in the performance of Sharp and its struggle to raise cash to keep the balance sheet afloat, reported The Wall Street Journal.
According to Reuters reports, Nikkei business daily first reported the talks between Sharp and Lenovo about the buyout. However, Sharp denied any such reports in a statement to Tokyo Talks Exchange.
Reuters further reported that Sharp had been in talks with Hon Hai Precision, a Taiwan-based industry, to sell its Chinese and Mexican TV plant. Hon Hai, which is reportedly planning to buy a stake in the Japanese electronics manufacturer and had bought a share in the company's advanced LCD panel plant in Sakai western Japan, may now buy only the Mexican TV plant.
Sharp projected that the company will bear $5.04 billion (Y450 billion) group net loss for the fiscal year, despite the drop of yen against the dollar which may improve matters. In November, the Japanese company announced that it is facing conditions that could raise uncertainties about its future as a going concern.
However, the news has resulted in soaring of the shares in Sharp. Businessweek reported that Sharp had the highest close, about 10 percent, in six months. It also reported that previous year the shares toppled 55 percent, the biggest decline among the Nikkei 225 Stock Average members.
Citing Nikkei reports, Businessweek reported that Sharp is in final talks on selling the Chinese and Malaysian plants in separate deals estimated for $339 million (30 billion yen). Hsinchu, Taiwan-based Wistron Corp. is in talks about the possible purchase of the TV plant in Malaysia,
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