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More Job Cuts Loom At Sharp Some Subsidaries Threatened

More Job Cuts Loom At Sharp Some Subsidaries Threatened

 

More than 2,000 jobs at overseas subsidiaries and
manufacturing plants are set to be axed this year along with 3,000 jobs in
Japan. Earlier this month we exclusively revealed that 8 roles had been axed at
Sharp Australia including that of Mark Beard Marketing Director.

 

Sharp is set to get what could be the last injection of US
$1.68 Billion in capital from banks as part of a restructuring operation.

 

The Company is set to report losses of $2.4 Billion when
they deliver a midterm business report on May 14 which is when the job losses
will be confirmed.

 

At this stage it is not known whether the company will
continue operating a full blown subsidiary in Australia or move to a
distributor model. 

 

In a statement issued on Friday Sharp said it’s studying a
structural overhaul and talking with its banks, but that nothing has been
decided yet.

 

The people familiar with Sharp’s plan said the company aims
to cut jobs in Japan and overseas, while trimming troubled operations making
solar panels and television sets.

 

The company is also ready to sell its headquarters, they
said.

 

Sharp’s lenders, led by the core banking units of Mitsubishi
UFJ Financial Group Inc. and Mizuho Financial Group Inc., are ready to write
off about ?200 billion in loans in exchange for Sharp shares, they said.

 

The debt-for-equity swap would mark the second big bailout
of Sharp in less than three years.

 

The Wall street Journal said that what is still undecided is
the fate of Sharp’s LCD business, which has fallen behind domestic rival Japan
Display Inc. as well as South Korean suppliers.

 

The people familiar with the talks said Sharp is continuing
to study a spinoff of the LCD business and an alliance with other parties, but
that any resolution may take some time as third party Chinese Companies are
already struggling to grow share in the TV market which is facing further
declines after falling 16 % in 2014.

 

People familiar with the matter said Sharp might be willing
to cede a stake in its LCD business to the government-backed Innovation Network
of Japan, which already holds 36% of Japan Display, but they said a sticking
point is Sharp’s desire to retain control of the business.

 

Many of Japan’s leading electronics companies, including
Panasonic and Hitachi, have posted stronger results recently, thanks to
decisive restructuring of money-losing consumer businesses and growth in
businesses serving other businesses such as car-parts manufacturing. Sharp, by
contrast, has lurched from crisis to crisis without developing a strong profit centre.

 

Even with a new bailout, “the company has a long road ahead
of it for an earnings recovery,” said Deutsche Securities analyst Yasuo Nakane.