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Chairman Gou optimistic about acquiring Sharp

Foxconn Chairman Terry Gou indicates his confidence on Sunday in winning the bid to buy Sharp. (Photo by Debby Wu)

TAIPEI -- Chairman Terry Gou of Hon Hai Precision Industry, also known as Foxconn Technology Group, said on Sunday he is confident about his company's chances of buying struggling Japanese electronics manufacturer Sharp.

     Gou's statement came ahead of an upcoming decision by Sharp's board early February on whether to accept Foxconn's multi-billion-dollar acquisition offer or a bailout plan by government-backed Innovation Network Corp of Japan (INCJ).

     The Nikkei has reported that Sharp is inclined to accept INCJ's proposal and its display business will gradually be merged with industry leader Japan Display. INCJ is also Japan Display's biggest shareholder.

     "I am confident because we are offering better terms and conditions than our competitor," Gou said, without elaborating on the details. The Taiwanese tycoon said he presented his proposal to Sharp's board in Osaka on Saturday.

     Gou said that INCJ is not a government agency and Foxconn is not trying to fight against the Japanese government on the Sharp deal.

     "The Japanese government actually wants Taiwan and Japanese tech companies to work together," he said, adding that he had met senior Japanese officials to discuss his acquisition efforts.

     Gou made the comments during Foxconn's annual year-end party.

     Foxconn is making a 700 billion yen ($5.78 billion) bid for Sharp, compared with INCJ's proposed capital injection of 350 billion yen, according to the Nikkei. However, Gou declined to confirm the figure.

     Gou said that he aims to support Sharp and he has no intention to merge Sharp with Foxconn.

     "Working with us will be the right decision (for Sharp)," Gou said.

Unpredictable year

Amid ongoing economic and market turmoil in China, the world's second largest economy, Gou said that 2016 will be an "unpredictable and volatile" year. However, he also said that weakening smartphone growth is only "transient," even though Apple has forecast that its revenue will see the first decline since 2003 in the current quarter due to slowing demand for its popular iPhones.

     He also said that Foxconn is planning to set up manufacturing facilities in Africa, without specifying a time frame.

     The chairman said that while Foxconn's revenue failed to reach the growth target of 10% in 2015, profits should be able to meet its goal.

     For all of 2015, Foxconn reported record revenue of 4.48 trillion New Taiwan dollars ($125.78 billion), rising 6.4% from a year earlier. In 2014, net profit was NT$130.53 billion on revenue of NT$4.21 trillion.

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