TOKYO (Reuters) – Japan Display Inc’s (6740.(T) said on Friday it would receive an investment of up to $100 million from a customer, a source said, ” it was Apple Inc’s (AAPL.Oh, as part of a bailout deal led by a Chinese firm, for the smartphone, a screen-maker.
FILE PHOTO: The logo of Japan Display Inc is seen at the production line of the LCD panel factory in Mobara, Chiba prefecture, June 3, 2013. (REUTERS photo/Toru Hanai/File Photo
Japan Display will be faced with a funding crunch, due to Apple’s recent shift to liquid-crystal displays (lcds), and lower-than-expected sales of the iPhone, XR, is the only LCD model in the company’s 2018 and the line-up.
Apple, which accounted for 60.6% of Japan Display’s revenue in the last fiscal year that ended in March, will be taking part in a consortium led by China’s Harvest, the Group’s investment is up to 80 billion yen ($743 million), said a person briefed on the matter.
Apple declined to comment.
Japan Display said in a statement, the Harvest had been formalized, the decision to inject nearly $500 million, including an investment of up to $100 million of the unrecognized customer needs.
In a separate statement later on Friday that the Japanese company is said to be a member of the consortium, a Hong Kong-based activist investor Oasis Management has decided to invest us $150 million and $180 million. The investment will be, depending on the circumstances, including any major cut-backs in orders from a major customer.
The total investment of the Harvest, the Apple, and the Oasis is still short of Japan Display’s $743 million to the target group. The company said it is in talks with other potential investors to conclude the deal.
The Asahi newspaper first reported on the company’s planned investments on Thursday, sending Japan Display shares are up 32%. On Friday, the stock was flat.
Japan Display was the pursuit of a bailout deal, with Chinese-Taiwanese consortium is, however, the suitors are repeatedly delayed making a formal decision has been taken to a re-evaluation of the prospects of the company.
Taiwanese display maker TPK Holding Co Ltd (3673.T), and the company’s financial CGL Group is dropped from the process earlier this month.
Japan Display comes with Apple more than $900 million of the $1.5 billion cost of building a smartphone screen plant for four years.
In order to help with the stabilisation of Japan Display, finance, Apple has agreed to slow down the pace of the loan repayment for a two year period, taking into account the increase in orders from Japan Display will.
The US-based tech giant will buy some of the organic light-emitting diode (OLED) display from Japan Display for the Apple Watch launch later this year.
Japan Display was formed in 2012 by combining the liquid-crystal-display businesses of Hitachi Ltd., 6501.T) To Toshiba Corp’s (6502.T) and Sony Corp (6758.(T) in the government-brokered deal to me.
($1 = 107.6700 of yen)
Reporting Makiko Yamazaki, and Kevin Buckland; Additional reporting by Stephen Nellis in San Francisco; Editing by Mark Potter and Christopher Cushing