Talks with Hon Hai are ongoing, but nothing has been confirmed and the company must get its books in order before a March deadline. According to those familiar with the matter, the Wall Street Journal reports, the company has been talking to Dell, Intel, and Qualcomm about capital and is looking for $240 million from Dell and Intel, and a smaller amount of money from Qualcomm. If the deals go ahead, they could take the shape of equity or debt.
Sharp itself recently had its credit rating downgraded to junk status and it needs investment, quick, or it is in danger of disappearing. So far it has already sold off TV assembly factories, but this hasn't been enough to stop it forecasting another full year of record losses.
Other Japanese companies have been similarly affected by a disastrous macroeconomic climate a strong yen, and slowing demand. Panasonic and Sony are both trying to raise money, with the latter having recently been downgraded to junk status as well.
Sharp hopes that its own cutting edge liquid crystal display technology, IGZO, can help it make some new friends. Although the displays are difficult to manufacture, faced with low yields, Sharp is the only company presently manufacturing the technology and it is betting the farm on industry interest.
Sharp's talks with Hon Hai began to decline when the company posted dire results earlier this year. There has also been less demand for its LCD TV sets and panels, the WSJ reports. A Sharp executive told the WSJ that its dicey earnings are not doing the firm any favours in winning over Hon Hai.