Taipei, Jan. 14 (CNA) Taiwan-based Hon Hai Precision Industry Co. confirmed Monday that it still plans to buy a stake in ailing Japanese electronics giant Sharp Corp., after a Sharp executive said the company may have several suitors.
Negotiations on the possible tie-up are ongoing, a Hon Hai spokesman said when asked about comments on the potential deal made by Sharp China Group general manager Nobuyuki Sugano to a Chinese newspaper over the weekend.
Hon Hai, the world's biggest contract electronics maker, and Sharp, Japan's largest liquid-crystal display (LCD) panel maker, will make a joint announcement once the planned deal is finalized, the spokesman said.
In a report in the Beijing-based National Business Daily posted online Monday, Sugano was cited as saying that cooperation with Hon Hai is just one of many deals his company is working on.
Sharp "can negotiate with several other companies" on financial and technical cooperation, Sugano said, but he noted that nothing has been made public because none of the potential deals have been finalized.
In the report, Sugano also said Sharp will continue in the development of indium gallium zinc oxide (IGZO), a semiconducting material that can be used as a channel for a transparent thin-film transistor.
He said 30 percent of smartphones Sharp plans to sell in Japan this year will be equipped with the advanced IGZO LCD panels.
Sources at Hon Hai who declined to be named because they are not authorized to do so said Hon Hai welcomed Sharp's possible cooperation with other companies, seeing it as a way for Sharp to raise new funds and for other companies to get access to Sharp technology.
Hon Hai's potential deal with Sharp would cover several topics, including IGZO technology, the acquisition of share and cooperation in other fields. Cooperation talks between them have never been cut off, the sources said.
Sugano's comments may indicate that Sharp is not as keen for a deal with Hon Hai as it was previously.
The company's stock closed at 330 Japanese yen on Friday following a report that it made an operating profit in the final quarter of 2012.
Hon Hai Precision Industry originally agreed early last year to buy a 9.9 percent stake in Sharp for 550 yen a share, but when the stock fell below 200 yen a share in August as the scale of the Japanese company's financial problems came to light, talks were held to discuss a new price.
Hon Hai Chairman Terry Gou has always insisted, however, that the potential deal was about more than simply giving Sharp a capital injection.
He has also pushed for a role in Sharp's management to get the Japanese company back on its feet, a condition that Sharp has been reluctant to accept.
In related news, Hon Hai on Monday declined to comment on another Chinese report that Foxconn, the trade name Hon Hai uses in China, has invested in the production of new alloy materials for the fabrication of high-speed railway carriages in China.
Hon Hai said it would not respond to any reports on new investments. In principle, any investment plan must be approved and verified before being made public, the company said.
(By Chung Jung-feng and