In recent weeks, Japan Display Inc. (JDI), which absorbed LCD production of Sony, Hitachi, and Toshiba in 2011, has been losing money, has most of its business with Apple. Sales have been dropping of late, to the point of putting the company in jeopardy. Late last week JDI inked a deal to get up to ¥100.8 billion JPY (USD$918.87 million) from Ichigo Asset Management, a Japanese investment company. To that end, the company terminated its memorandum of understanding with Suva Investment Holdings, a group of investors from China and Taiwan, it signed last year to get $715 million.

Under the terms of the deal, Ichigo will invest in Japan Display in and will eventually gain control of the company. The Innovation Network Corporation of Japan (INCJ), which currently controls JDI, will lose control but will retain a stake in the company. Stakes of other investors of JDI will get lower.

Japan Display, which absorbed LCD production of Sony, Hitachi, and Toshiba in 2011, has been losing money for years because until recently it only offered IPS LCD display panels and therefore had to compete against numerous companies from China with lower costs. To make the matters worse, JDI earned over 60% of its revenue selling displays panels to one customer, Apple. JDI’s sales dropped from ¥884.440 million in FY2017 to ¥636.661 million in FY2019. JDI’s OLED division, JOLED, yet has to become a viable player on the market. At present, JOLED’s screens are only used by Apple’s Watch, whereas OLED screens for iPhones are supplied by other companies. To date, JDI owes Apple more than $800 million.

Last year INCJ signed a memorandum of understanding to sell 49.82% of Japan Display for $715 million to Suwa Investment Holdings LLC, a conglomerate of investors consisting of China’s Silk Road Fund and Harvest Tech Investment Management, Taiwan’s TPK Holdings, and Fubon Financial Holdings. Under the terms of the new deal, JDI will get more money, whereas INCJ will retain a higher stake in the company.

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Sources: Japan Display, Reuters

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  • IBM760XL - Wednesday, February 5, 2020 - link

    Thanks for clarifying that; it probably should have been in the article. I also found it odd that a supplier could owe its customer money.

    I have to agree this was a poorly-written article. In addition to the issues already pointed out, "Stakes of other investors of JDI will get lower." also reads quite awkwardly. "Other investors in JDI will also see their stakes decrease." would be more natural and in keeping with the tone of the paragraph.

    I try not to be nitpicky, understanding that not every author at AT is a native English speaker, but when three of the four paragraphs have either obviously poor grammar or an unexplained and seemingly-illogical statement, I have to wonder whether no one read the article before clicking Publish.
    Reply
  • wrkingclass_hero - Thursday, February 6, 2020 - link

    You know, I usually avoid commenting on grammatical errors in articles, and even here I'm not going to complain about the grammar, but the layout and flow of the article was very poor. It flowed like a novel when you keep reading the same lines over again on accident as you try to move to the next line. Multiple lines were repeated multiple times, and I was confused while reading because I felt like I already read it. The article flowed like Momento on a scratched record. Reply
  • Cullinaire - Monday, February 10, 2020 - link

    The geopolitical nature of this deal has been repeated ad nauseum over the centuries... Reply
  • Sahrin - Monday, February 10, 2020 - link

    Everything Apple touches turns to shit/ Reply
  • monglerbongler - Thursday, February 13, 2020 - link

    >apple fronting money in the desperate hope that they don't have to continue to pay Samsung for the privilege of good quality OLED panels

    >failing miserably

    MY SIDES
    Reply

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