Samsung Acquires 3% Stake in Sharp for $112 Million
Samsung has purchased a 3 percent equity stake in Sharp for $112 million. The deal will help Samsung outsource LCD production and focus on OLED technology for smartphones.
As part of the deal, Samsung, which already buys some LCD screens from Sharp, will get more long-term supply of screens for TV sets, laptop PCs and tablets. According to The Wall Street Journal, the deal will help Samsung outsource LCD production and focus on OLED technology for smartphones.
“The investment is set to fortify the partnership between Samsung and Sharp and also lay a firm foundation for Samsung to secure a steady supply of LCD panels from diversified sources,” Samsung says.
The deal is also a financial boost for struggling Sharp, which forecasts a record $5 billion loss for its business year through March. Sharp had been in talks with Taiwan-based Hon Hai Precision Industry Co., also known as Foxconn, to raise capital, but the deal fell through.
Sharp did announce in December an investment from Qualcomm of up to $120 million to jointly develop new display technology.
The 3 percent stake makes Samsung the fifth-largest shareholder after four major Japanese financial institutions, according to multiple financial reports.
Samsung said it will have no involvement in Sharp’s management. The two companies expect to complete the deal later this month.
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Steve Crowe has been writing about technology since 2008. He lives in Belchertown, MA with his wife and daughter. Have a suggestion or a topic you want to read more about? Email Steve at firstname.lastname@example.org
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