Hon Hai shares dip as Sharp deal raises financial concerns
NORIKO OKEMOTO, NQN staff writer
HONG KONG -- Hon Hai Precision Industry's stock sank Wednesday in Taiwan after a morning bump from its agreement to buy Sharp, as investor enthusiasm gave way to concern about the impact on the Taiwanese company's finances.
The shares fell 2.17% to close at 81.20 New Taiwan dollars ($2.50).
The Taiwan Stock Exchange was closed on Monday and Tuesday, making Wednesday the first trading day after Hon Hai, also known as Foxconn, sealed a deal with the Japanese electronics company on Saturday. Although buying prevailed after the opening bell, Taiwanese shares as a whole suffered after U.S. stocks' poor showing Tuesday.
And some foreign securities firms raised concerns that the added financial burden on Foxconn from buying Sharp could keep it from maintaining dividends at current levels, a Taiwanese newspaper reported Wednesday.
Foxconn subsidiary Foxconn Technology, which will take a stake in Sharp as part of the deal, ended the day flat. Innolux, a Foxconn unit seen reaping substantial benefits from the acquisition, edged down 0.88%.