Employees work inside a Foxconn factory in Guangdong Province. (Photo : Reuters)
After weeks of discussions, Japan's Sharp Corp. and Taiwan's Foxconn Technology Group have finally reached a price tag for the latter's takeover of the struggling electronics firm.
Foxconn will acquire Sharp for $3.5 billion, a generous discount of $900 million based on previous talks. According to Reuters, the deal's massive price cut was on the back of Sharp's undisclosed liabilities.
The deal will allow the Japanese electronics company to revamp its strategy under a new management. When inked on Saturday, the takeover is set to be the largest acquisition made by a foreign group in the insular tech space in Japan.
Under the agreement, Foxconn will purchase Sharp's shares for $0.78 cents each, with the option of augmenting its cut next year.
The takeover will enable Foxconn to use Sharp's expertise in mobile screens, one of the priciest mobile device components today.
The agreement will also permit the Taiwanese firm to buy Sharp's LCD operations should the deal fail.
"I am thrilled by the prospects for this strategic alliance and I look forward to working with everyone at Sharp," said Foxconn CEO Terry Gou in a joint press release on Wednesday.
"We have much that we want to achieve and I am confident that we will unlock Sharp's true potential and together reach great heights," Gou added.
Meanwhile, Kozo Takahashi, president and CEO of Sharp, said, "I am pleased with our decision [to] form a strategic alliance and merge both forces between Sharp and Foxconn to accelerate innovation with the 'creativity and entrepreneurial spirit' of both our companies."
In 2012, Sharp suffered huge financial blows in its investments in solar panels and display screens. Since then, the company has failed to expand its presence globally due to a dearth of resources despite remaining a top brand in its home country.
