Samsung Electronics would be investing US$110 million in Sharp Corp in 2013 to stabilize the supply of television and improving the opportunities for the Japanese screen maker. As a result of the announcement, share prices of Sharp jumped by as much as 19% in early trading.
The investment would be done for a 3% share in Sharp according to three sources who told Reuters on condition of anonymity. With the investment, it makes Samsung the largest foreign shareholder with Qualcomm Inc. Qualcomm for its part promised to give US$120 million for a piece of shareholdings.
The deal would be over and above the US$4.4 billion bailout given by banks last October.
This is a rare opportunity for cross border deals between rivals and the first time a South Korean firm has ever purchased a stake in a Japanese rival. Sharp, together with Sony and Panasonic have been mounting losses in the overseas television market.
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