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JDI Gets New Bailout Proposal
December 15, 2019
JDI bailout by Suwa has evaporated and the company is now negotiating with Ichigo Asset Management for an investment of 90b¥ ($830m -) through a share purchase at 50¥/share, a 46% discount to the current price and a 38% discount to the pre-rumor price of 69¥ Ichigo will join Apple and Taiwanese contract electronics manufacturer Wistron Corp in bailing out the LCD panel maker. The CEO of Ichigo is expected to join JDI as Chairman if the deal goes through, with a closing by the end of JDI’s fiscal (March 2020). Ichigo replaces Suwa Investment Holdings, which was to provide 50 billion yen ($470 million) of the total 80 billion yen in October, which never happened. Apple has promised to support JDI with a $200m investment in some form, which has helped JDI’s negotiations with potential investors after a number of Chinese firms backed out of potential commitments, but for Apple such an investment is more protecting the $1.5b pre-payment for product from JDI, which was reduced when Apple started using OLED panels and over $800m in pre-payments still remains. Apple has extended terms for the money owed and adding an additional $200m investment, which could either be funding for a stake by an investment firm or direct funding for equipment purchases to expand JDI’s OLED production capabilities. INCJ, a quasi-government organization that funded the company’s original formation, is its current largest shareholder, and has been loaning working capital to the company during negotiations.
December 15, 2019
JDI bailout by Suwa has evaporated and the company is now negotiating with Ichigo Asset Management for an investment of 90b¥ ($830m -) through a share purchase at 50¥/share, a 46% discount to the current price and a 38% discount to the pre-rumor price of 69¥ Ichigo will join Apple and Taiwanese contract electronics manufacturer Wistron Corp in bailing out the LCD panel maker. The CEO of Ichigo is expected to join JDI as Chairman if the deal goes through, with a closing by the end of JDI’s fiscal (March 2020). Ichigo replaces Suwa Investment Holdings, which was to provide 50 billion yen ($470 million) of the total 80 billion yen in October, which never happened. Apple has promised to support JDI with a $200m investment in some form, which has helped JDI’s negotiations with potential investors after a number of Chinese firms backed out of potential commitments, but for Apple such an investment is more protecting the $1.5b pre-payment for product from JDI, which was reduced when Apple started using OLED panels and over $800m in pre-payments still remains. Apple has extended terms for the money owed and adding an additional $200m investment, which could either be funding for a stake by an investment firm or direct funding for equipment purchases to expand JDI’s OLED production capabilities. INCJ, a quasi-government organization that funded the company’s original formation, is its current largest shareholder, and has been loaning working capital to the company during negotiations.
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