Struggling Japanese electronics giant Sharp says it has accepted a $4.3bn (£3.08bn) takeover bid by Taiwanese multinational Foxconn.
The announcement came as Sharp’s board completed a two-day meeting to discuss competing takeover offers.
Foxconn assembles most of the world’s iPhones. Sharp is one of Japan’s oldest technology firms.
It is the first foreign takeover of a major Japanese electronics firm in a historically insular technology sector.
Japanese officials had been reluctant to let Sharp fall under foreign ownership because of the distinctive technology behind its display panels.
Founded in 1912, innovations by Sharp include a mechanical pencil in 1915 and and pioneering developments in television engineering.
Although recent years have seen a downturn in its fortunes with heavy debts, the firm continued to be a leader in liquid display technology, a key asset for Foxconn.
Going global together
Shares in Sharp, which employs more than 50,000 globally, will be issued to Hon Hai Precision Industry Company, also known as Foxconn Technology Group.
Sharp’s shares were at one point halted from trade, pending the announcement. They later reopened and closed down by nearly 15%.
Technology specialists said the firms would probably work well together on a global platform.
“Sharp is strong in research and development, while Hon Hai knows how to market products to customers such as Apple, and it also has expertise in production. Together they can go global,” Yukihiko Nakata, a technology professor and former Sharp engineer told AFP news agency.
What’s behind the takeover? – Karishma Vaswani, Asia Business Correspondent
Trying to save one of the giants of the Japanese tech sector has been challenging to say the least, but even harder if the defacto response in your industry to any foreign takeover deal is usually a no.
That’s because Japan’s technology sector is historically extremely insular, and has been reluctant to let outsiders in.
Partly the concern is fuelled by a fear that Japan’s proprietary technological expertise may be at risk – but partly it’s also because of a Japanese corporate culture that prefers keeping the dirty laundry in the family.
But when times are tough, business acumen trumps nationalistic tendencies.
A takeover by Foxconn could help Sharp sell its liquid crystal display panels elsewhere in the region and inject fresh funds and ideas into the ailing electronics maker.
But turning Sharp around won’t be easy. Even after two bailouts it has been unable to turn its fortunes around. Will Foxconn be able to succeed where others have failed?
Earlier this month, as it was considering several takeover offers, Sharp posted a bigger-than-expected net loss of $918m (£630m) for the April-to-December period.
Kozo Takahashi, left, has been president of Japan’s electronics giant Sharp Corporation since June 25, 2013
In 2012, the firm came close to entering bankruptcy. It has struggled with heavy debts and has been through two major bailouts in the last four years.
Foxconn first offered to invest in the troubled Japanese firm in 2012, but talks collapsed