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Foxconn buys controlling stake in Sharp

dpadpa 2/04/2016

Apple supplier Foxconn has signed a deal worth almost $4.5 billion to take ove Japanese electronics company Sharp.

Taiwanese tech manufacturing giant Foxconn has taken over ailing Japanese electronics company Sharp in a deal worth nearly $US3.5 billion ($A4.56 billion).

Apple supplier Foxconn will invest Y389 billion ($A4.51 billion), Y100 billion less than previously planned. The deal would give Foxconn a controlling stake of 66 per cent.

"Both sides agreed. Suggestions made from external assessment also show it's a reasonable deal," Tai Jeng-wu, a member of Foxconn's board of directors, said ahead of the formal signing on Saturday.

Foxconn had suddenly put its offer on hold a month ago, saying it needed to examine more closely new information it received about Sharp's financial health.

On Wednesday, Sharp revised down its earnings outlook for the current financial year ending Thursday March 31. It projected an operating loss of Y170 billion, compared with an operating profit of Y10 billion estimated in February.

Sales were predicted at Y2.45 trillion, down nine per cent from the Y2.7 trillion it had forecast in March.

Sharp was a pioneer in flat LCD screens, but suffered stiff competition in recent years from Korean and Chinese manufacturers.

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