Sharp’s solar arm continues to lose money while new owner starts to emerge
Feb 5, 2016 17:00 CET
February 5 – Sharp Corp’s (TYO:6753) energy solutions unit, or solar cell business, continued its loss-making run in the electronics major’s fiscal third quarter, while the company got a bit closer to finding a new owner that may very well be a foreign entity.
On Thursday, the Japanese firm said that its solar arm recorded an operating loss of JPY 5 billion (USD 42.7m/EUR 38.4m) in October-December 2015, expanding from a deficit of JPY 1.6 billion a year back, mainly due to the decline of polysilicon prices. Sales dropped by 35.6% year-on-year to JPY 34.5 billion because of lower demand in the residential and industrial sectors in Japan.
Sharp also adjusted downwardly its forecast for the full fiscal year regarding both sales and operating income at the energy solutions segment because of the above-mentioned factors. It now expects an operating loss of JPY 7 billion on sales of JPY 170 billion.
Meanwhile, the company continues to hold talks regarding its planned management reconstruction. As previously reported, there are two parties that compete for Sharp’s shares, namely Taiwanese peer Hon Hai Precision Industry Co Ltd (TPE:2317), better known as the Foxconn Technology Group, and public-private fund Innovation Network Corp of Japan (INCJ). On Thursday, Sharp confirmed in a press statement that it has narrowed the list of candidates down to two companies — Foxconn and INCJ.
Following certain media reports, the company issued another statement today to stress that it has not provided Foxconn with priority negotiation rights. Sharp added it will continue to hold discussions with the Taiwanese group, which has extended the effective term of its offer to Sharp until February 29, 2016.
Also on Friday, Foxconn’s chairman Terry Gou told reporters that the company plans to ink a final deal for the takeover of Sharp by the end of the month. An unspecified legal issue has prevented the parties from doing so today, he said, as cited by the Wall Street Journal.
(JPY 100 = USD 0.853/EUR 0.767)
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