Hon Hai Will Develop an Integrated LCD TV Base in Taiwan

In joint development of large-sized LCD (liquid crystal display) TV with Sharp, Hon Hai will produce and sell some models in Taiwan, making Taiwan an integrated development base, in the hope of teaming up with Japan to beat Samsung, their common rival, reported Terry Guo, chairman of Hon Hai yesterday (June 18).

At Hon Hai's shareholders' meeting, Guo stressed that he will not negotiate the price again for buying into Sharp, despite the sharp decline of the latter's stock prices recently, and will not intend to grasp the management of Sharp. Institutional investors predicted that in the future Sharp can team up with Chimei-Innolux and Chimei Materials Technology, both under the auspices of Hon Hai Group, to form an integrated production model for LCD TV, covering brand, panel display, and key components, thereby gaining advantage in production cost.

Guo noted that Sharp excels in the front-technology, such as flat panel display, while Hon Hai has higher yield rate in backlit panel, mold, and assembly. The cooperation of both parties will be able to rival Samsung absolutely, according to Guo.

The cooperation with Sharp, said Guo, has a guidepost effect, as evidenced by more than 10 Japanese enterprises seeking to forge similar cooperation with Hon Hai. The duplication of the cooperative model can lead to the formation of an even larger "Taiwan-Japan alliance."

Guo revealed that Hon Hai and Sharp are jointly developing over 60" high-end LCD TV, including thin-frame models which can form into a TV wall. Some models will be produced and sold in Taiwan. Hon Hai can even provide installation and maintenance/repair service, thereby creating some 1,000 job vacancies.

Despite sharp drop of Sharp stock prices, Guo denied that he intended to negotiate with Sharp again for the conditions of the alliance. "I invested in Sharp, due to its value, and don't care short-term drop of its stock price. I even hope to increase my investment at the low price level," said Guo.

Hon Hai bought into Sharp, owning 9.9% stake. Guo expressed that he didn't rule out raising the shareholding, adding, however, Hon Hai will not dominate the management of Sharp.

Guo also invested, in personal name, in Sharp Display Products, a 10th-generation FPD plant.

source & copyright: CENS