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Apple supplier Japan Display has lost out on Chinese funds from a key investment firm leading a proposed bailout deal, but Apple could be about to double its own investment to aid in the LCD panel maker's restructuring, according to reports.
Chinese firm Harvest Group has been leading the consortium for an 80 billion yen ($740 million) bailout deal, which includes investments from Apple and Hong Kong-based activist investor Oasis Management.
However,
Nikkei Asian Review today reports that Harvest Group has decided it will not provide any financial aid to Japan Display Inc, also known as JDI. Harvest was expected to contribute 63 billion yen ($557 million), said
Nikkei, citing sources familiar with the negotiation.
This is just the latest disappointment for the ailing Japanese firm, which has seen its bailout plan falter repeatedly. The display maker had been expecting $230 million from Taiwan's TPK Holding to cover its losses, but the proposal was
withdrawn in June.
Then, just days later, financial firm CGL Group also dropped its investment plans, leaving JDI unsure whether other members in the Chinese-Taiwanese consortium would follow through with their own bailout proposals.
However, this morning's news wire suggests Apple is considering a revised plan that would see the tech giant double its investment in Japan Display to 20 billion yen, up from the 10 billion yen ($100 million) it
originally proposed in June.
JDI relies on Apple for more than half of its sales, and supplies the liquid crystal display panels for the
iPhone 11, which has helped support its bottom line. However, its mainstay LCD business has been hit heavily by the growing adoption of OLED panel technology.
That has left the supplier scrambling to invest in OLED production to turn around its business, which saw a $2.3 billion loss in 2018.
On a positive note, JDI received a 20 billion yen infusion earlier this month from Innovation Network Corporation of Japan. Japan Display also supplies the OLED displays for then new
Apple Watch Series 5 models, according to well-known analyst
Ming-Chi Kuo.
Last month, Kuo
forecasted that Japan Display will gradually increase its proportion of OLED display orders for the Apple Watch, starting with 15-20 percent of orders in 2019 and reaching 70-80 percent in 2021.
If the Japanese firm can rethink its restructuring plans with the help of Apple, it could potentially supply OLED panels for future iPhones, which would in turn allow Apple to diversify its supply chain and reduce its heavy reliance on Samsung for the newer OLED display tech.
This article, "
Apple Considering Revised Plan to Double Investment in LCD Panel Maker Japan Display" first appeared on
MacRumors.com
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