There’s been a rare ray of sunshine for troubled Japanese technology giant Sharp after computing giants Intel and Qualcomm were reported to be ready to jointly invest 30 billion yen (circa $378 million) into the debt-saddled company, which saw its credit rating crash to ‘junk’ status.
Reuters reports that sources within Sharp revealed that a deal for investment from Qualcomm could be reached by the end of November. US chip maker Intel is reportedly doubling up to put the money into the firm, which produces the display for Apple’s iPhone 5, among components for other electronic devices.
Sharp’s share price rose by up to 10 percent in trading today, as the news of the speculated investment circulated.
The boost comes at a time of great uncertainty for Sharp, the 100-year-old company, which is forecasting net losses of $5.7 billion (50 billion yen) for the year as increased competition and lower prices take a toll on its business.
Sharp’s own take on its future has prompted further confusion after the company reworded the English-version of a key section of its most recent quarterly report. As the Wall Street Journal’s Digits blog reports, earlier this month, the company removed a phrase highlighting “material doubt” about its financial future, softening other wording from a paragraph that discussed its ongoing financial uncertainties.
Uncertainty is a word that is oft-used for another big issue for the firm, Hon Hai’s ongoing talks to invest. The Taiwanese manufacturer — which owns Apple and Microsoft partner Foxconn — has been in talks to buy a 9.9 percent investment for a reported $844 million for some while, but no final deal has been reached. Talks were thought to have stalled over prices, given the slide of Sharp’s share price this year, but new reports suggest the discussions could continue beyond the March 2013 deadline.
Sharp announced plans to cut 11,000 jobs in September and, later that month, it closed a key refinancing deal which provided $4.6 billion in loans. It announced a $350 million voluntary redundancy program in August as part of earlier plans to layoff 5,000 employees.
Headline image via Kazuhiro Nogi/AFP/Getty Image