April 1, 2016
Taiwan-based Foxconn, the penny-pinching factory operator that helped fuel Apple’s growth, agreed to acquire Japanese screen maker Sharp for $3.5 billion. Weeks of negotiations concluded with a deal for a 66 percent stake in Sharp, that’s worth roughly $2 billion less than Foxconn offered last month.
Foxconn, the world’s largest maker of hardware, hopes to gain more leverage and higher value expertise when partnering with Apple, which uses Sharp’s screens in roughly 25 percent of its smartphones.
Foxconn is seeking to control more of the supply chain, even as Apple diversifies its supply chain. Foxconn enjoys huge scale and efficiency in its production base, but desires to climb the value chain with new, more profitable streams of revenue.