Japan Display appears poised to sell its Japanese smartphone LCD panel factory to Sharp for close to $ 390 million.
Work at the plant in question – located in Ishikawa prefecture, in Hakusan – has now stopped since July 2019, due to the reduction in orders for LCD panels by Japan Display's main customer: Apple. Not only that, but the Cupertino house had also financed a large part of the 1.6 billion dollars that were necessary for the creation of the plant itself, which went into operation around 2016.
At the time, Apple made extensive use of LCD technology on its smartphones, but in 2017 it began a gradual transition to OLED that caught Japan Display off guard. This year the Cupertino house will launch for the first time a range of new iPhones entirely equipped with OLED panels, or those belonging to the iPhone 12 family, leaving only the iPhone SE 2020 to adopt an LCD screen.
The sale of the Hakusan plant would allow Japan Display to recover approximately 670 million dollars (also including the sale of numerous machinery inside it) and to no longer have the management of an inactive production line on its shoulders. This should give the company some relief, although much of the proceeds will have to be paid to Apple to repay the debt incurred with the opening of the plant.
Sharp's purchase would allow Sharp to convert LCD panel production from the smartphone sector to the automotive and medical equipment sector, further strengthening its position in these sectors.
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