Ailing Japanese electronics giant Sharp is set to offload two of its manufacturing plants, shedding thousands more jobs than was originally feared, according to the latest reports from Tokyo.
Sharp plans to eventually sell two of its TV production plants in Mexico and China to Foxconn parent company Hon Hai, according to Japan’s Daily Yomiuri newspaper.
This would apparently result in 3,000 extra job losses on top of the 5,000 already announced by the under-fire firm earlier this month, amounting to about 12 per cent of Sharp’s global workforce.
It’s not a done deal yet, however, with Sharp claiming no final decision has yet been made over the future of the two plants.
Given its precarious financial position, however, it would seem to be a case of when and not if.
Net losses in the last quarter topped £1bn and even possible saviour, Taiwanese ODM Hon Hai, is now looking to renegotiate the level of its investment in the ailing Japanese firm.
It originally offered ¥66.9bn (£547m) for a 9.9 per cent share of Sharp and ¥66bn (£539.58m) for a 46.5 per cent stake in Sharp's joint venture TV business with Sony, but wants a cheaper stake now that Sharp’s shares have slumped.
The Japanese firm desperately needs the dough to pay off some of the ¥1.25 trillion worth of debt it has accumulated, although Taiwanese regulators will need to approve any proposals first.
Its grand plan to turn the company around includes placing more emphasis on services and “one-of-a-kind products” such as the IGZO TV, while offering regional offices more autonomy. ®