2 Min Read
CHIBA (Reuters) - Japan's Sharp Corp on Friday forecast its first net profit in four years following cost-cutting under new Taiwanese owner Hon Hai Precision Industry Co Ltd (Foxconn), and said it would resume making active investments.
With Foxconn turning around the struggling liquid crystal display (LCD) maker since last year's $3.8 billion acquisition, Sharp is now looking to invest in future growth drivers.
It has teamed up with Foxconn to bid for the chip unit of Toshiba Corp, sources previously told Reuters, and last week said it would invest up to $1 billion in SoftBank Group Corp's technology-focused $100 billion Vision Fund.
"We have joined the bidding" for Toshiba's chip unit, Sharp Chief Executive Tai Jeng-wu said at a briefing, in Sharp's first official confirmation of its involvement. "But we cannot comment further as we are in the middle of the (auction) process."
Toshiba, the world's second-largest NAND chip maker, is depending on the sale to cover billions of dollars in cost overruns at its now bankrupt U.S. nuclear unit Westinghouse.
Tai also said Sharp wants to build an LCD factory in the United States if conditions are met and competitiveness assured.
"The United States is the biggest panel market, but there are no panel plants there," Tai said.
The LCD maker forecast net profit of 59 billion yen ($530 million) for the year through March, reversing a loss of 24.9 billion yen a year earlier.
The outlook compared with the 41.9 billion yen average of nine estimates from analysts surveyed by Thomson Reuters.
Sharp also released its first midterm business plan since Foxconn's acquisition, targeting operating profit of 150 billion yen for the year ending March 2020. That would compare with 62.5 billion yen in the year ended March.
($1 = 111.3900 yen)
Reporting by Makiko Yamazaki; Editing by Christopher Cushing