OSAKA -- A public-private fund is mulling a plan to integrate Sharp's photovoltaic business and a solar subsidiary of Showa Shell Sekiyu as part of its efforts to rescue the embattled Japanese electronics maker, sources told The Nikkei.
The fund, the Innovation Network Corp. of Japan, plans to inject capital into Sharp in a broader attempt to consolidate the country's electronics sector and help revive the once-mighty liquid crystal display maker.
The innovation network on Saturday presented a rescue plan that includes a capital injection of 300 billion yen ($2.49 billion). Sharp executives held a meeting on the same day at the company's head office in Osaka to discuss the plan.
Sharp is widely expected to accept the proposal.
For years, the company's solar and LCD businesses have been suffering from deteriorating profitability.
Even though Sharp is the solar panel market leader in Japan, the company's solar business reported an operating loss of 62.6 billion yen in the year through last March. Falling solar panel prices, valuation losses on inventories of raw materials and other factors have cut into Sharp's earnings over the years.
Meanwhile, Solar Frontier, a Showa Shell Sekiyu group company based in Tokyo, has been struggling to generate profits by supplying cells for mega solar farms due to competition from Chinese and other rivals.
Under the plan, the public-private fund would lead efforts to restructure Sharp's solar business, such as streamlining surplus production facilities, then integrate the unit with Solar Frontier's business.
Sharp will consult its major lenders before making a decision in February.