Foxconn's global dealmaking suffers Sharp shock

Nu Ride

24/05/2023 03:51

(The author is a Reuters Breakingviews columnist.  The opinions
expressed are her own.)
    By Robyn Mak
       HONG KONG, May 24 (Reuters Breakingviews) - The iPhone
supplier rescued the Japanese electronics group in 2016 with a
promise to turn it around. Sharp’s surprise $1.6 bln writedown
casts doubt on the Taiwanese group’s grip on its investment. It
also raises questions about Foxconn’s push into assembling
electric vehicles.

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    CONTEXT NEWS
Taiwan's Foxconn, formally known as Hon Hai Precision Industry,
on May 11 reported net profit of T$12.8 billion ($417 million)
for the three months to March, a decrease of 56% from a year
earlier. The company attributed the slump to a non-operating
loss of T$19.7 billion related to its 34% stake in Japanese
electronics maker Sharp.
    Foxconn said it would seek an explanation from the Japanese
firm and "work harder on the management of our investment
businesses", adding that it would ask Sharp to "adjust its
management team" to improve operations if needed.
    Sharp reported a 220-billion-yen ($1.6 billion) impairment
loss in the quarter, mostly from buildings, machinery and
goodwill relating to display businesses.

 (Editing by Peter Thal Larsen and Thomas Shum)
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