Qualcomm Inc will invest up to $120 million in Sharp, a move that will make the American firm one of the biggest shareholders of the Japanese TV maker. It will also help Sharp get back on track, after the Japanese company announced it would fire 10,000 employees by March 2014, due to a loss of $4.7 billion in 2011.
At the moment, Sharp supplies screens for iPhones. The Japanese company will work together with Qualcomm in order to make chipsets and new power-saving screens based on Sharp’s IGZO technology. Qualcomm will work with Sharp through its Pixtronix subsidiary.
It was only a $4.4 billion bank bailout that saved the Japanese company from failing this year. The new agreement with Qualcomm might be an encouraging sign for the worried investors, the international press comments.
“With this agreement Sharp will accelerate its strategy for growth in small-to medium-sized LCDs,” the Japanese company said.
Qualcomm will first invest Y4.93 billion by the end of 2012. The moment when the rest of the investment will be made is to be decided. However, the investment will be a crucial element in Sharp’s profitability, analysts say.
Sharp estimated a total loss of Y155 billion for 2012.