Struggling Apple display maker Japan Display claims it has nailed down an extra $830 million in bailout financial support from Japanese asset manager Ichigo Asset Management.
Ichigo joins Apple and Apple contract manufacturer Wistron in the effort to save the beleaguered business. And it wouldn’t have done it without Cupertino’s support.
According to sources, Apple’s commitment to propping up Japan Display helped convince others to pledge their own support. “It’s a vote of confidence,” one person said, describing the deal.
Japan Display has been losing money for the past five years. Last month, it recorded its 11th quarterly loss in a row. A previous bailout deal collapsed after a Chinese investment firm and several others pulled out.
Recently, the company received even more bad news. After a former executive was found to be embezzling funds, Japan Display said it would review its past earnings.
Japan Display bailout
At one point, Japan Display shined as of Apple’s biggest display manufacturers. But its failure to adopt OLED display technology over LCD caused it to fall behind. Japan Display is now taking its first steps into OLED manufacturing.
It will create its first OLED screens for the Apple Watch. This will help Apple to diversify its supply chain, which currently depends heavily on LG Display.
Japan Display still owes Apple almost $900 million for a smartphone display plant built four years ago. To help the display-maker through this rough patch, Apple agreed to slow the pace of expected repayments. Apple is additionally paying money it owes Japan Display in shorter increments to boost cash flow.
At the very least, I hope Tim Cook gets sent a very nice Christmas card in thanks.
Source: The New York Times