March 10, 2015 / 5:33 AM / 3 years ago

Sharp executive says display unit to remain independent

TOKYO (Reuters) - Sharp Corp is not considering merging its troubled display business with rival Japan Display Inc, an executive said on Tuesday, adding that the unit had a technological advantage over its competitors.

A shopper wearing a mask rides an escalator past advertisements for Sharp Corp's Aquos television at an electronics shop in Tokyo March 3, 2015. REUTERS/Yuya Shino

“Looking at our overall display business including our medium and large-sized screen operations, we believe we should be on our own,” Norikazu Hohshi, the head of Sharp’s device business, which includes displays, told reporters at a briefing.

He was responding to speculation that loss-making Sharp could merge its display business with Japan Display.

Sharp is due to post its third annual net loss in four years, hurt by aggressive competition from its rival and weaker-than-expected smartphone demand in China.

Sharp is compiling a new business plan, and sources familiar with the matter said Chief Executive Kozo Takahashi met with officials from its main lenders Mizuho Bank and Bank of Tokyo-Mitsubishi UFJ last Thursday, although he did not request specific amounts or make promises about restructuring.

Hohshi acknowledged Sharp may need help, but said nothing had been decided.

“It is true that our capital is thin. We will need more support in this area in the future, but that is currently under consideration,” he said.

The banks agreed in September 2012 to rescue Sharp with loans and credit lines worth 360 billion yen, or $3 billion at today’s exchange rates, in exchange for promises to return to the black by this year. Sharp then exited the European TV market and closed solar-panel businesses in Europe and the United States.

(This story has been corrected to remove extra word “was” in the first paragraph; also to specify in second paragraph that device business includes displays)

Reporting by Ritsuko Ando; Editing by Edwina Gibbs and Miral Fahmy

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