Sharp decides to accept Hon Hai support and enters under the umbrella of the first overseas manufacturer, what is the aim of Hon Hai?



Sharp is in trouble with management, leading Taiwanese leading electronics manufacturer,Hon Hai Precision Industry(Hon Hai) officially decided to accept proposal for acquisition. With this, Sharp became the first major Japanese electronics manufacturer to become a subsidiary of overseas manufacturers.

Sharp Board of Directors formally decided Honhai subsidiary NHK News
http://www3.nhk.or.jp/news/html/20160225/k10010421271000.html

Sharp accepts a purchase plan of about 650 billion yen to be rebuilt under Hon Hai | Reuters
http://jp.reuters.com/article/sharp-decision-idJPKCN0VY076

"Sharp, decision acceptance acceptance from" Hong Qi "" News i - TBS video news site
http://news.tbs.co.jp/newseye/tbs_newseye2711176.html

According to the report, Sharp opened an extraordinary board of directors from the morning of February 25, and the "Industrial Innovation Organization" of government funds which presented Hon Hai, which provided support of 700 billion yen scale, and 300 billion yen of equity investment Having decided to accept Hon Ho's proposal unanimously, after consultation on which support will be accepted. In the future, Hon Hai will invest about 650 billion yen to make a de facto acquisition, and will purchase 100 billion yen out of Sharp's preferred stock owned by the bank. The remaining 100 billion yen will be retained by the bank as it is.

Hon Hai's president Terry Gow has declared a policy to rebuild Sharp, saying, "I'm not going to dismantle Sharp but I want to survive for the next 100 years" about the proposed reconstruction plan, and Sharp's brand While maintaining the potential to deny the possibility of integration with other companies. However, Chairman Gow has sold the photovoltaic business and stance that "employment of employees over 40 is not necessarily guaranteed" will also not be guaranteed, and how it will develop in the future will be in a situation where uneasiness and expectation will be confused so.

Future developments
With the de facto acquisition by Hong Qi, Sharp will become the first major Japanese manufacturer to enter under the umbrella of overseas manufacturers. Voices saying "worried about the outflow of technology in Japan" are raised, and attention is paid to Sharp's future and Hong Hui's aim, including worrying about the worst scenario that "only technologies that are wanted are organized afterwards" For a moment, Mr. Kenichi Ohmae, a management consultant, points out that Hong Hai's aim is that "Guo Chairman dreams of his own brand".

KON 608 "Mitsubishi Heavy Industries · Toyota Motor · Toshiba · Sharp ~ Hon Hai · Guo Chairman dreams of own brand"
http://www.lt-empower.com/ohmae_blog/viewpoint/1450.php

In his blog, Mr. Ohmae said, "It is Sharp's brand that Kon Hao's chairman Sharp is acquiring Sharp's acquisition, rather than wanting technology," and shows that the technology is not the objective, " Hon Hai became a company that raises 15 trillion yen sales, but what we have made is "other people's thing." Therefore, if there is a part where Guo Chairman is not only filled with one's own brand I think, "I predict the aim of Hon Hai. Hon Hai has achieved great success in the order receiving industry, but the view that the company's brand is necessary for the survival in the future, the view that Sharp's brand was necessary for that is consent as a strategy as Gow chairman led by the company It is a part that can be done.

In accordance with this announcement, various perspectives are also shown in the media.

Honhai's acquisition of Sharp is aimed at organic EL of "iPhone 8" | Mobile Research Institute
http://mobilelaby.com/blog-entry-foxconn-has-acquired-sharp.html

【Economic Understanding】 Sharp can believe Hon Hai! Is it? ... In sister city partnership "Taiwan from China" From daytime "strong bond" (3 / 3page) - Sankei WEST
http://www.sankei.com/west/news/160225/wst1602250001-n3.html

Hon Hai to cast 700 billion yen to buy Sharp | DOL special report | Diamond Online
http://diamond.jp/articles/-/86037?page=4

I do not know at the moment just when President Gow's real intention is at the present moment just after the announcement, but basically how is the policy of Gow president reflected that it shows the direction of survival is reflected in what form It is inevitable that attention will gather.

The de facto buying play is definitely going to be a milestone in the trend of the Japanese economy, so it seems that it is inevitable that anxiety will rise at the end of the future as much as possible. Nonetheless, it is meaningless to fuck anxiety only blindly, so it is important to keep a close eye on future developments, to grasp the situation, and also to pay attention to the future of the Japanese economy That's right.

Sharp's official Twitter account response
These news were reported at 11 o'clock on February 25, but about one hour later at 12:11 Sharp's official Twitter account "Koma?"Tweets are posted. This is probably a content that seems to have reacted with "this seriously" after getting coverage.

A tweet that was posted at 12:15 just after that was posted "As of 12:15 is over from our company".

◆ 2016/02/25 18: 20 Addendum
Sharp announced the announcement of the resolution of the Board of Directors who decided to receive support from Hon Hai.

(PDF)Notice concerning issuance of new shares through third-party allocation and change of parent company, major shareholder and major shareholder - 160225.pdf


Among them, Sharp described the circumstances leading up to the support of Hon Hai, and for about six reasons, Hon Hai decided that it was the best for all Sharp stakeholders (stakeholders).

① The total amount of contribution by this scheduled allocation will be 489 billion yen, as stated in "3. (2) Specific use of funds to be procured" below, by such investment, strengthen the competitiveness of the display department business , And it is also possible to provide adequate funds and capital to cover the growth investment necessary for each of our businesses to grow together, and also to improve our financial standing, such as increasing working capital Judging that it is contents that make a big contribution

② The planned allocation destination is in a mutually complementary relationship with the Company in the liquid crystal business and it is expected to further strengthen the competitiveness of our business through collaboration in this business, It is thought that the synergistic effect on business is great, such as further improvement of our productivity and cost competitiveness can be expected by utilizing manufacturing technology as EMS of EMS
③ From this planned allocation destination, a sufficient understanding of the Company's brand, existing employees and the value of a wide range of product line-ups and the significance of maintaining the ecosystem surrounding our business has been shown, A strong commitment was obtained for management of the Company after execution of the third-party allocation new capital including the following
(I) independence of management
Maintain and respect the independence of management of the Company and its subsidiaries
(Ii) maintenance of integrity
Maintain integrated operation of each business of the Company and its subsidiaries and provide sufficient support for alliances with third parties that the Company desires
(Iii) Maintaining Employment of Employees To commit to the principle of maintaining the employment of existing employees and to respect our autonomous judgment regarding the optimization of the organizational structure
(Iv) Importance of brand value Under mutual understanding concerning efforts to improve brand value including customer service and responsibility for supply products,
Continue to use the "Sharp" brand by way of contributing to the maintenance and improvement of the value of the "Sharp" brand
(V) Maintaining our technology Keeping our R & D and manufacturing functions in Japan and cooperating with each other to prevent our core technology from running out
④ In addition to the fact that there was a transaction through ODM such as liquid crystal television, mobile phone · smartphone etc., in addition, we have jointly operated Sakai display product which produces a large liquid crystal panel from August 2012, Ahead
As a joint management partner, including achieving operating profit for the third consecutive year from the fiscal year ended December 2012 by realizing stable supply of LCD panel manufacturers to LCD TV set manufacturers that are What has been built
⑤ Hon Hai Precision Industry, one of the plans to be allotted, is held by Mizuho Bank, Ltd. and Mitsubishi Tokyo UFJ Bank, Ltd. (hereinafter referred to as the "Financial Institution" together with Mizuho Bank, Ltd.) We plan to purchase half of all Class A shares for a total amount of 100 billion yen and the issue price per share and other conditions in the third party allotment increase are particularly favorable conditions for this scheduled allocation However, taking into consideration the establishment of the business foundation through the third party allotment of shares and the effect of the enhancement of corporate value, it was thought that it was a condition that fully considered the interests of existing shareholders
⑥ The planned allocation destination is to offer a deposit of 100 billion yen in the stock subscription contract to be concluded in order to increase the certainty of execution of the third party allotment increase, We will agree that we can confiscate this deposit as planned damages in case we failed to fulfill obligation to pay, etc.

◆ 2016/02/26 00: 05 postscript
Terry Gow, president of Hon Hai, who accepted the support proposal by Sharp, reported that he was sticking to the official signing.

Foxconn Hesitates on $ 5.5 Billion Bid for Sharp - The New York Times
http://www.nytimes.com/2016/02/26/business/foxconn-sharp.html

Foxconn's Deal for Sharp Now in Question - WSJ
http://www.wsj.com/articles/sharp-accepts-foxconns-6-25-billion-takeover-offer-1456367642

Newsletter News: Hon Hai, reserving Sharp acquisition agreement = 350 billion yen Fear of expansion of liabilities
http://www.jiji.com/jc/c?g=eco&k=2016022500838

This news is reported in Japan and abroad. According to the content, Hon Hai revealed in a statement in February 25, Afternoon that Sharp 's proposal acceptance was announced, Hon Hai told for a while to sign a capital alliance contract with Sharp. In the statement about the reason, it became clear that it was a big factor that "serious information" was brought in from Hon Hai to Sharp on February 24, the day before Sharp's release.

Mr. Takashi Mochizuki, one of the writers who wrote the article on the Wall Street Journal, has tweeted about this "serious information", and it is likely that it will be necessary to repay 350 billion yen of contingent liability (future repayment in litigation etc.) The debt) information is brought to Hon Hai, that list is over 100 items, but Hong Hai side has revealed that it is still a positive attitude to the acquisition.

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