The Japanese corporation Sharp Corp has agreed with the banks on the allocation of aid in the amount of $ 1.9 billion. It is actually the second time in three years when the company is in need for this kind of support and it is due to the large losses of the business for the production of screens for smartphones, losing the competition to Asian companies.
Mizuho Bank and Bank of Tokyo-Mitsubishi UFJ will spend together 200 billion yen in the business debt-equity swap, Sharp said Thursday. This will allow the company to gain time, but will not be able to dispel doubts about the bright future of its business for the production of displays.
The received funds will be used to repay the debt.
Another 25 billion yen, Sharp will receive from the Japan Industrial Solutions fund.
Instead, Sharp will take new measures to reorganize the business, including the reduction of 10 % of the staff, which will imply about 3500 jobs in Japan.
In the past fiscal year, Sharp had a net loss of 222.35 billion yen ($ 1.9 billion). Over the past four years the company only once finished the year with a profit.
"We intend to re-enter the start and achieve recovery," - said the head of Sharp, Kozo Takahashi.