TOKYO (Reuters) – Japan Display Inc (6740.T) said on Friday it would receive a $100 million investment from a customer, which a source said was Apple Inc (AAPL.O), as part of a bailout deal led by a Chinese investment firm for the smartphone screen maker.
FILE PHOTO: The logo of Japan Display Inc is seen at the company’s production line for LCD panels in its factory in Mobara, Chiba prefecture, June 3, 2013. REUTERS/Toru Hanai/File Photo
Japan Display is facing a funding crunch due to Apple’s recent shift away from liquid-crystal displays (LCDs) and disappointing sales of the iPhone XR, the only LCD model in Apple’s 2018 line-up.
Apple, which accounted for 60.6% of Japan Display’s revenue in the last financial year ended March, will join a consortium led by China’s Harvest Group in investing up to 80 billion yen ($743 million), said a person briefed on the matter.
Apple declined to comment.
Japan Display said in a statement Harvest had formalized its decision to inject nearly $500 million, including the $100 million investment from the unidentified customer.
In a separate statement later on Friday, the Japanese company said another consortium member, Hong Kong-based activist investor Oasis Management, has decided to invest $150 million to $180 million. The investment is dependent on conditions including no major cuts in orders from a main customer.
The total investment from Harvest, Apple and Oasis will be still short of Japan Display’s $743 million target. The company said it is in talks with other potential investors to join the deal.
The Asahi newspaper first reported on Apple’s planned investment on Thursday, sending Japan Display shares up as much as 32%. On Friday, the stock was flat.
Japan Display had been pursuing a bailout deal with a Chinese-Taiwanese consortium, but the suitors repeatedly delayed making a formal decision in order to reassess the company’s prospects.
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