Hitachi says in talks with Hon Hai on panel tie-up

By @ibtimes on

Hitachi Ltd is in talks with Taiwan's Hon Hai Precision Industry Co about a tie-up in small liquid-crystal display panels, the president of the Japanese industrial conglomerate said on Tuesday.

Hitachi President Hiroaki Nakanishi also told Reuters in an interview that changes in demand for nuclear power in the United States would make it hard for a joint venture with General Electric to meet its target of more than 38 power plant orders by 2030.

Nakanishi said he was still considering options for the conglomerate's Hitachi Displays subsidiary.

Japan's Nikkei newspaper said on Monday that Hon Hai, one of the biggest contract manufacturers for Apple's iPhone and iPad, would buy a majority stake in the unit for about $1.2 billion.

We are talking to them, that's true, Nakanishi said, when asked about the possibility of a tie-up between the two firms in the display sector. They are interested. We have no reason to refuse (to talk).

He gave no further details.

Hitachi Displays is currently 24.9 percent owned by Canon Inc, which told Reuters in September that it had dropped a plan to take over the business.

Nakanishi said the unit needed more independence from Hitachi in order to make the large and timely investments required to compete in the increasingly commoditized LCD panel business.

One way of doing that is an IPO. Another is a partnership with another company, he said.

Shares in Hitachi closed up almost 1 percent at 415 yen on Tuesday, before the interview was published, while the benchmark Nikkei stock average fell 0.6 percent.

(Reporting by Kentaro Hamada and Isabel Reynolds; Editing by Edmund Klamann)

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