Loss-making Apple screen supplier Japan Display has reportedly been saved by a $723M bailout by a group of investors from China and Taiwan …
Japan Display has been struggling due to its very late decision to diversify from LCD panels into OLED ones. It was a particular blow to the company when Apple made its switch to OLED with the iPhone X. Japan Display knows that it moving into OLED is now overdue, but has been struggling to fund the capital costs.
LCD has fallen out of fashion in the last few years primarily because it requires a standalone backlight component. The pixels of an OLED screen are individually lit, allowing them to be used in devices with more irregular shapes. Apple has also been exploring microLED displays as another LCD alternative.
Reuters reports that the new investment group is expected to become the largest shareholder in the company.
Ailing Apple supplier Japan Display Inc will receive up to 80 billion yen ($723 million) in a bailout from a group of Chinese and Taiwanese investors, Kyodo news agency reported.
A group including China’s state-backed Silk Road Fund and Taiwanese panel maker TPK Holding Co will inject around 60 billion to 80 billion yen, taking a stake of 30-50 percent in Japan Display, Kyodo said, without citing sources.
The deal, if realized, would make the group the top shareholder of the liquid crystal display (LCD) maker, replacing the Japanese government-backed INCJ fund, which currently owns 25.3 percent of the company, the report said on Tuesday.
Silk Road Fund had previously denied that it had been engaged in investment talks with Japan Display, but didn’t immediately reply to a request for comment by Reuters.
The news agency’s own source says that the display company has been in discussions with multiple investors, with a deal expected to be concluded by the end of March.
It’s not the first time Japan Display has had to be rescued. It required a similar injection of cash from the Japanese government back in 2016.