After the Taiwanese multinational that own Foxconn mentioned that it would delay its multi-billion takeover of Sharp because of new information, the feeble Japanese giant’s shares fell almost 15% on Friday.
Analysts had cheered Hon Hai Precision’s bid for Sharp – the first overseas acquisition of a major Japanese electronics firm – which has teetered on the edge of bankruptcy for years as its consumer electronics division piled up massive losses.
The Japanese government was reportedly concerned about Sharp’s key technologies falling into the hands of a foreign firm.
Despite its bleeding balance sheet, Sharp is still a leader in liquid crystal display (LCD) technology and the firm remains one of Japan’s best-known corporate brands overseas.
But the century-old firm piled up eye-watering losses after the 2008 global financial crisis and has struggled through a restructuring plan that has yet to pull it out of the red.
Analysts generally praised the Hon Hai deal, saying it would enhance the firms’ existing business ties.
The companies have worked together for years on large-sized screen technology, including for televisions, and jointly operate an LCD panel plant in Japan.