Sony ans Sharp are ending their joint venture to produce and sell large liquid-crystal displays for TVs, with to Sony sell its shares (representing 7.04% of the issued shares) in Sharp Display Products Corporation (SDP) to SDP.
On July 1, 2009, Sharp transferred its LCD panel plant in Sakai City, Osaka Prefecture, to SDP, a wholly-owned subsidiary of Sharp. On December 29, 2009, Sony invested 10 billion yen into SDP in exchange for new shares issued by SDP to Sony (representing 7.04% of the issued shares of SDP) and, as a result, SDP became a joint venture company of Sharp and Sony as of the same date.
As part of Sony's new strategy to buy panels rather than invest in manufacturing them and in light of the rapidly changing market for LCD panels and LCD televisions, in March 2012 Sharp and Sony agreed to amend the original joint venture agreement to provide that Sony would not make additional capital injections in SDP.
Sony won't lose any money as it will receive 10 billion yen ($126 million), the same as what it paid for shares in the Sharp subsidiary, which produces panels in Sakai city, western Japan.
Sony recently also ended its joint venture with Samsung to produce flat panels.
Sony has bled money for eight straight years in its core TV business, bashed by competition from Samsung and other Asian rivals.
In related news, Sharp and Taiwan's Hon Hai Precision Industry Co (Foxconn) will reportdly jointly produce panels for Apple's iPhone and other consumer electronics products in China, the Nikkei business daily said on Thursday.
With its technology expertisse, Sharp will help Hon Hai to maintain lower defect rates at its planned plant in Chengdu in China.