Sharp Rises After Report on Talks With Dell for Investment
Sharp Corp. (6753), the TV maker that warned about its ability to survive, rose the most in a week in Tokyo trading after the Wall Street Journal said the company’s in talks with Dell Inc. for an investment.
Japan’s biggest maker of liquid-crystal-display panels gained 3.1 percent to 169 yen, trimming the year-to-date decline to 75 percent and valuing the company at 188 billion yen ($2.3 billion). The Osaka-based company is the world’s worst- performing major stock this year.
Sharp is in talks with Round Rock, Texas-based Dell to arrange capital investment of as much as $240 million, the Journal said, without citing anyone. The maker of Aquos TVs has failed to win a planned 67 billion-yen investment from Taiwan’s Foxconn Technology Group and had its credit rating cut to junk after widening its loss forecast for the year.
Earlier this month, Sharp said there was “material doubt” about its ability to survive after forecasting a record 450 billion-yen, full-year loss on falling demand for its display panels. Sharp is cutting jobs, seeking voluntary retirements, reducing pay and selling assets as part of a turnaround plan.
Atsushi Yoshida, a spokesman for Sharp, said the company wasn’t the source of the report and that nothing has been decided. Dell (DELL) “doesn’t comment on rumor and speculation,” Kim Otzman, a spokeswoman for the maker of Latitude computers, said in an e-mail.
President Takashi Okuda said Nov. 1 the company is considering various partnership options.
Kyodo News said Nov. 13 that Sharp was in final talks with Intel Corp. (INTC) to get an investment of as much as 40 billion yen, which would make the world’s biggest chipmaker the top shareholder. Sharp wasn’t the source of information for that report, and nothing has been decided, the Osaka-based company said in a statement Nov. 14. Chuck Malloy, a spokesman for Santa Clara, California-based Intel, declined to comment at the time.
The Japanese company may also get an investment from Qualcomm Inc., Kyodo said Nov. 13, without saying where it got the information.
The Asahi newspaper said Oct. 26 Sharp was seeking capital alliances with Hewlett-Packard Co., Intel, Microsoft Corp. (MSFT), Google Inc. and Apple Inc. (AAPL), without saying where it got the information. Sharp denied the report at the time.
Sharp, which hemorrhaged 103 billion yen in cash from operations in the first half of the year as Japan’s electronics industry struggles with dwindling demand and competition from Samsung Electronics Co., may turn to the Japanese government for a bailout, analysts said earlier this month.
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