Tokyo - Foxconn Technology Group is in the final stages of negotiations to buy Sharp in a deal that could be worth about 500 billion yen ($4.4 billion). Once finalised, the Taiwan-based assembler of Apple’s iPhones and iPads will take control of a 104-year-old company that played a key role in Japan’s post-war economic resurgence.
Below is a timeline of events leading up to the sale:
1912: Founder Tokuji Hayakawa, a metalworker, invents a belt buckle that works without belt holes. He then develops an always-sharp mechanical pencil, and later names the company after the hit product.
1923: A massive earthquake destroys Sharp’s factory in Tokyo; Hayakawa’s wife and children die in the disaster. Lenders call in their loans and he loses most of Sharp Pencil to creditors. Hayakawa later rebuilds the business in Osaka and starts making radio receivers.
1949: Sharp holds an initial public offering on the Osaka Stock Exchange, followed by a Tokyo Stock Exchange listing in 1956.
1951: After building a successful radio business and surviving the tumult of World War II, Sharp bets big on televisions, later working with RCA to license the US manufacturer’s technology.
1980: Hayakawa dies at age 86, after transforming Sharp into a major manufacturer of radios, TVs, microwave ovens, calculators and other electronic products.
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2000: After betting on the growth of flat-panel displays, Sharp pioneers the development of mobile phones with a built-in digital camera.
2012, February-August: Sharp surprises the market with a forecast for a loss instead of a profit for the preceding fiscal year, as profits dwindle amid fierce competition in the global flat-TV market. The company later agrees to sell 9.9 percent of itself to Foxconn. The loss outlook is widened later that year, and Foxconn seeks to renegotiate its deal.
September-December: Sharp turns 100 and secures 360 billion yen of funding from Mizuho Corporate Bank and the Bank of Tokyo-Mitsubishi UFJ. The electronics maker forecasts a record $5.6 billion loss and says there is “material doubt” about its ability to survive. Qualcomm agrees to buy a 2.6 percent stake in Sharp for 9.9 billion yen as part of a partnership to develop displays.
2013: Sharp agrees in March to sell 3 percent of the company to Samsung Electronics. The deadline for the agreement for Foxconn lapses, although both sides say they will continue talks.
2014: Foxconn Chairman Terry Gou tells Toyo Keizai magazine that he was “fooled” in negotiations with Sharp over investment.
2015: Sharp reopens discussions with other companies, saying it’s considering selling its liquid-crystal display business. Sharp later seeks an investment from Innovation Network of Japan (INCJ) in a separate subsidiary that will take over its business in smaller LCD panels used in smartphones and tablet computers.
2016, January: Foxconn’s Gou meets with Sharp’s banks and officials from the Japanese government and makes its case for acquiring a controlling stake in the company. Later that month, he offers more than 600 billion yen to buy Sharp.
February: Sharp’s divided board meets to determine the fate of the company. Sharp negotiates with Foxconn and INCJ, with the goal of reaching a deal by the end of the month. On February 5, Gou spends a day at Sharp’s headquarters and says after meetings that “we are 90 percent there.” INCJ later says its offer is superior.
February 25: Sharp declares Foxconn the winner, and announces plans to sell new stock, in a move that would give the Taiwanese company majority control. Hours later, Gou delays the signing of a final agreement. He said Foxconn learned about liabilities at Sharp that could exceed 300 billion yen under certain circumstances.
March: Foxconn pushes for a new agreement in which it will pay about 389 billion yen for equity in Sharp, and 100 billion yen for preferred shares owned by the banks, though the payment may be delayed. Board meetings are scheduled for the end of the month.
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