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Musing on Financials
Sharp To Buy NEC Display
March 29, 2020
According to the Japanese trade press, Sharp will acquire ~2/3 of the shares of the display products division of NEC for ~$90m. NEC is known for its customized products, which range from desktop monitors between 17” and 24”, large format commercial TV products between 43” and 86”, and a line of LED video walls. They customize such products for a variety of specialized industries such as healthcare, restaurants, and education with their customers concentrated in North America and Europe. This offsets Sharp’s focus on Japan and the Asian community. NEC display is also known for their projectors, which range from entry level ($330) to cinema quality ($130,000 to $150,000). NEC has been slowly divesting its hardware businesses to favor networking and IT services.
NEC and China’s SVA (now Tianma) built a Gen 5 LCD fab to augment NECs Gen 2 LCD fab that the company bought from Mitsubishi in 1999. While this fab was state-of-the-art when built, overcapacity caused the company to close one line and cut staff by 50% only a few years later. From that point NEC was no longer able to compete on a global scale and became an application specific display company. Sharp’s own LCD production fabs should be able to supply any basic display product needed and will help Sharp to fill its fabs during slow season.
Sharp To Buy NEC Display
March 29, 2020
According to the Japanese trade press, Sharp will acquire ~2/3 of the shares of the display products division of NEC for ~$90m. NEC is known for its customized products, which range from desktop monitors between 17” and 24”, large format commercial TV products between 43” and 86”, and a line of LED video walls. They customize such products for a variety of specialized industries such as healthcare, restaurants, and education with their customers concentrated in North America and Europe. This offsets Sharp’s focus on Japan and the Asian community. NEC display is also known for their projectors, which range from entry level ($330) to cinema quality ($130,000 to $150,000). NEC has been slowly divesting its hardware businesses to favor networking and IT services.
NEC and China’s SVA (now Tianma) built a Gen 5 LCD fab to augment NECs Gen 2 LCD fab that the company bought from Mitsubishi in 1999. While this fab was state-of-the-art when built, overcapacity caused the company to close one line and cut staff by 50% only a few years later. From that point NEC was no longer able to compete on a global scale and became an application specific display company. Sharp’s own LCD production fabs should be able to supply any basic display product needed and will help Sharp to fill its fabs during slow season.
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