Japan Display Explores Sale Of Smartphone Factory To Apple For $ 820 Million


The Japan Display plant, which took $ 1.5 billion to build four years ago, could be sold for $ 820 million if either company decides to make the purchase. Sharp, a child company of Taiwanese electronics giant Foxconn, is studying its options.

“We are examining it carefully, examining the impact that any purchase would have on our profits, and if and how much risk it would involve,” Sharp said in a statement.

The poster in Japan had recently negotiated with Ichigo Asset Management to receive financial support. However, depending on the amount that Japan Display agrees to accept, this could provide Ichigo with effective control of the company. Ichigo could provide Japan Display with up to 45 billion yen ($ 414 million) in the form of common stock purchases of up to 50 yen per share.

Japan Display said it was considering all of the options available for its plant, located in Ishikawa Prefecture, Japan.

according to Reuters Apple did not respond to a request for comment.

Japan Display’s financial hole is largely due to an agreement with Apple, where it borrowed about $ 1.5 billion to build an LCD screen factory four years ago under the assumption that they would repay l over time. However, Apple’s switch to OLED has resulted in lower orders for Japan Display, and the company still owes more than $ 800 million.

Apple has been involved in bailout consortia for Japan Display to keep the business running and has offered shorter payment terms. Japan Display is expected to rely on Apple for approximately 60% of its revenues.

As the company slowly evolves to produce OLED panels, perhaps for Apple, Apple may have to wait up to two years before it even receives its first OLED screen from the company.

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