Sharp warns it may go under
Sharp management says it may not be able to continue in business after forecasting a $5.6bn loss for the current financial year to the end of March 2013.
‘Sharp is in circumstances in which material doubt about its assumed going concern is found,’ says a Sharp company statement.
In September Sharp secured bank loans 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.
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%.