Sharp bailed out by banks
Sharp has been bailed out by the banks to the tune of $4.6bn. Mizuho Corporate Bank and the Bank of Tokyo-Mitsubishi are to put up $2.3bn in loans and extend a $2.3bn revolving credit facility.
Sharp has debts of $12.76bn, of which $4.25bn will mature within twelve months; $4.56bn is commercial paper, $2.39bn is in the form of corporate bonds and $1.56bn is long-term debt.
Sharp has cash of $2.75bn. It has forecast a loss of $3.2bn for the current financial year.
To secure the loans Sharp has put up its Osaka HQ building and its stake in Pioneer as collateral. Sharp has already reduced its stake in Pioneer from 14.3% to 9.2%.
Sharp has announced a plan to lay off 10,000 employees and has been in lengthy negotiations with Foxconn of China about selling a 10% stake in Sharp to Foxconn. There have also been reports that Sharp has been trying to sell its flat panel plants in Mexico and China to Foxconn.
Other Sharp businesses reported to have been up for sale are Sharp’s copier business, air conditioning business, a solar battery factory and a Japan-based display factory.
There had been rumours that Intel was talking about putting $383m into Sharp to buy a stake which would secure it supplies of Sharp’s IGZO displays for Intel’s Ultrabooks.