Foxconn Technology and Sharp approved the Taiwanese electronics maker’s reduced takeover bid for the struggling century-old Japanese company, the two companies said Wednesday.
Apple supplier Foxconn will invest 389 billion yen (3.5 billion dollars), 100 billion yen less than previously planned. The deal would give Foxconn a controlling stake of 66 per cent.
If the deal goes through, it would be the largest foreign acquisition of a major Japanese electronics manufacturer.
"Both sides agreed. Suggestions made from external assessment also show it's a reasonable deal," Tai Jeng-wu, a member of Foxconn's board of directors, told a news conference in Taipei.
Sharp chose Foxconn over a bid of 300 billion yen but forward by state-backed investment fund Innovation Network Corporation of Japan after months of negotiations.
Wednesday’s move came one month after Foxconn put on hold its offer to take over Sharp after the Taiwanese company said it needed to examine more closely new information it received about the Japanese company.
The two companies were to sign a final agreement on Saturday in Osaka and Sharp president Kozo Takahashi and Foxconn chairman Terry Gou have scheduled a news conference.
On Wednesday, Sharp revised down its earnings outlook for the current financial year ending Thursday March 31. It projected an operating loss of 170 billion yen, compared with an operating profit of 10 billion yen estimated in February.
Sales were predicted at 2.45 trillion yen, down 9 per cent from the 2.7 trillion yen it had forecast last month.