Electronics manufacturer – Sharp, on March 6, 2013, has announced a tie up with the South Korean company Samsung. The value of the deal is reportedly $111 million and is a rare move from a Japanese-based company.
At present, Sharp is struggling to maintain its balance sheet and said that Samsung will buy 10.4 billion yen ($111 million) of its new shares, or a 3% stake in the Japanese firm, which will make the smartphone and tablet manufacturer the biggest foreign share holder. After the reports of the deal spread in the market, the shares of Sharp soared more than 17% in early trade, before ending 14.04% higher.
Samsung too was up by 0.65. The deal was announced after the Seoul and Tokyo markets had closed. The South Korean company, while talking about the investment, said that they would lay a firm foundation to secure a steady supply of LCD panels from diversified sources.
Sharp has also announced a separate 4.94 billion yen capital injection deal by US chipmaker Qualcomm, which is also considered to be one of the major rivals of Apple, the US-based technology heavy weight. Other reports have claimed that the expected investment in Sharp by Taiwan’s Hon Hai Precision (which makes Apple products in China) has also been shelved.