Japan State-Backed Fund Mulls Buying Majority Stake in Sharp: Report

Stated-backed fund Innovation Network Corporation of Japan (INCJ) is considering buying a majority stake in Sharp Corp for an estimated JPY 200 billion (roughly Rs. 10,841 crores) as part of its restructuring, the Yomiuri newspaper reported on Wednesday.

Sharp may agree to the purchase after spinning off its loss-making liquid crystal display (LCD) business, the newspaper said. A basic agreement over the aid plan could be reached during the current fiscal year ending in March, it added.

The report sent shares in Sharp as much as 11 percent higher in early trade. They were up 6.4 percent at 0053 GMT.

Asked about the newspaper report, a Sharp spokesman said the company was considering various options for its LCD business and that it was in talks with multiple parties.

An INCJ spokeswoman declined to comment.

INCJ, which Japan launched in 2009 to keep the technology sector competitive, has been considering ways to invest in Sharp, and has asked the company's main lenders to forgive some of its debt in return for investment, people familiar with the matter have told Reuters.

As part of its plan for restructuring the screen maker, INCJ may also seek the resignation of Chief Executive and President Kozo Takahashi and other senior managers, the Yomiuri said.

Sources have told Reuters INCJ is considering brokering a merger or partnership with Japan Display Inc, in which the fund is a top shareholder with a stake of over 35 percent.

© Thomson Reuters 2015