Japan Display to receive $100 million investment from Apple as part of bailout deal
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.
Japan Display is facing a funding crunch due to Apple’s recent shift away from liquid-crystal displays (LCD) 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, will join a consortium led by China’s Harvest Group in investing up to 80 billion yen ($742 million), said the source familiar with 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 customer.
Another consortium member, Hong Kong-based activist investor Oasis Management Company Ltd, is planning to invest $150 million, but Japan Display said it had not yet received a formal notification from the fund.
The company is in talks with other potential investors to join the deal.
The Asahi newspaper first reported on Apple’s planned investment early Thursday, sending Japan Display shares up as much as 32%. The stock closed 18% higher.
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.
Taiwanese screen maker TPK Holding Co Ltd (3673.TW) and financial firm CGL Group dropped out of the process earlier this month.