Japan Display’s top investor INCJ to meet lenders
June 08 2016 08:54 PM
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The logo of Japan Display is seen at the company’s new production line for LCD panels in its factory in Mobara, Chiba prefecture. Japan Display reported a ¥31.8bn loss for the year that ended in March, citing weak demand for its smartphone displays.

Reuters/Tokyo

Japan Display’s top investor, the state-backed Innovation Network Corp of Japan, is set to meet with Mizuho Bank and other lenders yesterday to discuss the health of the smartphone display maker, people familiar with the matter said.
The sources told Reuters the meeting comes after the Apple Inc supplier received a short-term loan of ¥30bn ($280mn) from the lenders in late May.
The company repaid that money after a payment from Apple came through. Japan Display is facing weaker demand from high-end handset makers, with Apple, which accounts for about 40% of its sales, reporting slower iPhone sales.
Mizuho Bank, Sumitomo Mitsui Banking Corp and Sumitomo Mitsui Trust Bank expect INCJ, which owns 36% of Japan Display, to eventually ask for more funding, three of the sources told Reuters.
But a fourth source denied the fund or Japan Display was seeking more funding, saying yesterday’s meeting was aimed at more general discussions over the screen maker’s future.
INCJ declined to comment on the meeting, but said it would continue to support Japan Display’s growth strategy. The banks and Japan Display also declined to comment.
The sources declined to be identified because the talks were confidential. Japan Display has no debt, but two years of losses have tightened its liquidity at a time when it needs major investment in new technology to meet a shift in clients’ demand.
The meeting also comes after domestic rival Sharp Corp, facing a financial crunch, was rescued earlier this year by Taiwan’s Foxconn, formally known as Hon Hai Precision Industry.
INCJ had originally tried to rescue Sharp with the aim of brokering a merger between it and Japan Display but lost to Foxconn’s higher offer, sources have said.
Japan Display reported a ¥31.8bn loss for the year that ended in March, citing weak demand for its smartphone displays, wider than the ¥12.3bn loss a year earlier.
It said it would close two domestic liquid crystal display production lines and introduce an early retirement programme.
The company was formed in a government-backed deal in 2012 by merging the loss-making display units of Sony Corp, Toshiba Corp and Hitachi. It started out lagging Sharp and other Asian rivals, before growing in 2015 on strong orders from Apple. Japan Display said earlier this year that it would start mass production of OLED panels in 2018, the year that media reports say Apple may begin adopting OLED technology for its iPhones.






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