Samsung Electronics will reportedly buy a 3% stake in Japanese rival Sharp via a capital increase, a press report said on Tuesday.
The Japanese newspaper Nikkei said that Sharp would sell Samsung new shares worth around Y10 billion ($107 million).
According to Nikkei, the two companies could explore cooperation in other areas as well.
An official announcement of the deal is expected to be released soon.
Sharp has been seeking for investors in an effort to gain cash, as the company has suffered from stiff competition in the market for liquid crystal screens that has pushed prices lower.
Shap has been making displays for Apple at its plant in Kameyama, central Japan. A deal with Apple's rival Samsung could ensure an efficient display production flow for the Korean company, which will use it for its smartphones and tablets.
In December, Qualcomm agreed to invest as much as $120 million in Sharp. As part of that agreement, Qualcomm said it would work with Sharp to develop new, power-saving screens based on Sharp's IGZO technology.