Foxconn to buy Sharp, proposes $2.5 billion

Foxconn is considered as the world's most prominent electronics manufacturer which is known for production of smartphones for Apple, Xiaomi, Microsoft, Sony and many others. Foxconn Chief Executive Officer Terry Gou is in Osaka to meet executives of Japan's Sharp Corp, a Sharp spokesman said, one day after the struggling electronics maker said it was focusing on the Taiwan firm's takeover bid over a rival offer from a Japanese state-backed fund.

Shares in Osaka-based Sharp soared 10 percent in early morning trade, bringing two-day gains to 29 percent. Gou plans to brief the media in Osaka at 0600 GMT (3.00 p.m. Japan time), the Sharp spokesman said. Foxconn, known formally as Hon Hai Precision Industry Co, has offered to invest around 659 billion yen ($5.6 billion) in the struggling Japanese electronics maker Sharp Corp, people familiar with the matter said.

One person said Sharp's board had voted 13-0 to negotiate with Foxconn instead of the state-backed Japanese fund, the Innovation Network Corp of Japan. The people declined to be identified as they were not authorized to speak publicly on the matter. The Sharp spokesman declined to comment further. Foxconn declined to comment.

A takeover by Foxconn, which assembles various electronics products such as smartphones and television sets for Apple, Sony Corp and many other major international companies, would vastly expand sales channels for Sharp's liquid crystal display (LCD) panels.

While a generous Foxconn offer had been flagged, many investors in Japan were surprised to see an overseas firm gain the upper hand over a state fund. The decision comes after months of uncertainty over the fate of the company, whose display panel business has continued to suffer massive losses despite two major bailouts by its banks in the last four years.