FOXCONN CHAIRMAN Terry Gou said he wants to take a seat on Sharp's board as part of any investment in the ailing LCD maker.
Hon Hai Precision Industry, which better known by its trading name of Foxconn, is eyeing a deal with Sharp in order to get access to the firm's LCD manufacturing plants. Now Terry Gou, the chairman of Hon Hai, has publicly stated his desire for a seat on Sharp's board of directors as part of any deal between the two firms.
Sharp is in need of cash and as ratings agency Standard and Poor's recently cut its credit rating to junk status, it will find it hard to get institutional investors to put money into the firm. Gou was expected to step up with financial investment, but said that Sharp needs more than just money.
Gou said, "If it's just a capital investment, Sharp can go and talk to its banks, or an investment company. It doesn't need Hon Hai at all." Then he told Taiwan's United Evening News, "If it was just a capital investment, why would I want it?"
Gou very well knows that Sharp's credit rating means that it can't turn up at a bank and expect to get millions, which is why the proud Japanese company has pinned its hopes on a Chinese outfit.
Sharp is paying a high price for its investment in LCD television plants back in the mid-2000s, with demand in recent years drying up. With the firm's position as one of the biggest LCD makers around and linked with manufacturing the screen in Apple's upcoming Iphone 5, one reason for Gou's sudden interest in the firm might be to further secure Foxconn's business relationship with Apple. µ
Sign up for INQbot – a weekly roundup of the best from the INQ