Foxconn deal for Japan's Sharp in doubt after last-minute hitch

Thu Feb 25, 2016 9:34am EST
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Makiko Yamazaki and J.R. Wu

TOKYO/TAIPEI (Reuters) - Taiwan's Foxconn put its takeover of electronics maker Sharp Corp on hold on Thursday after discovering previously undisclosed liabilities, sources said, throwing into doubt what was set to be the biggest takeover by a foreign firm in Japan's technology sector.

Loss-making Sharp announced earlier in the day that it had agreed to be bought by Foxconn, a contract manufacturing firm that is a major Apple Inc supplier.

But, in a separate statement issued just hours later, Foxconn said it would not sign until it had clarified terms in "new material information" from Sharp. It did not elaborate.

Two sources with direct knowledge of the matter said the Japanese group had contingent liabilities that amounted to "hundreds of billions of yen".

That issue would have to be resolved before a deal could be finalised, said the sources, who spoke on condition of anonymity as the talks were confidential.

The sources did not elaborate on the nature of the liabilities or the exact amount. Reuters has not seen a copy of the new information.

A spokesman for Foxconn, known formally as Hon Hai Precision Industry Co Ltd, declined to comment on the issue. Sharp also declined to comment.

  Continued...

 
The logo of Sharp Corp is seen at Tochigi plant in Yaita, north of Tokyo, November 19, 2015. REUTERS/Reiji Murai