Early hires at Taiwanese suppliers Foxconn and Pegatron could indicate more-complex hardware for the upcoming iPhone 7.
Sharp, which makes TVs and displays for smartphones and tablets, put itself up for sale after $10.76 billion in losses in recent years.
By acquiring Sharp, which supplies screens for iPhones, Apple contractor Foxconn also looks to become a major player in LCD panels.
The iPhone SE and the 9.7-inch iPad Pro have gone on sale as Apple seeks to broaden its customer base with smaller and cheaper products.
The widely expected announcement came after weeks of dramatic negotiations that saw the deal value fall by a third from its original offer.
Foxconn had agreed a month ago to buy Sharp for more than $5.31 billion, but has held off on signing a final agreement.
Taiwan's Foxconn, a key Apple contractor, will reportedly gain a controlling stake in Sharp, a troubled Japanese electronics company.
The 9.7-inch iPad Pro starts at $599 for 32GB of storage, while the 12.9-inch model starts at $799.
Despite its smaller size, the 9.7-inch tablet packs many of the same features as its larger sibling.
The agreement will reportedly allow Sharp to borrow from its lenders if the deal goes through.
The deal announced Thursday has run into trouble over disagreements between the two companies over financial disclosures.
Taiwan's Foxconn said a plan to buy Sharp wasn't final, contradicting an announcement by the Osaka company.
The Japanese electronics giant, which had earlier accepted the takeover bid, reportedly sent over a new document to Taiwan’s Foxconn.
The CEO also said that Apple was not committed to an idea until it was spending money on tooling.
Sharp’s shares gained 25.7 percent in two days on the Tokyo Stock Exchange on Friday reports of Foxconn’s chief flying to Japan to meet company officials.
Company shares soared following news about the bidding war between Foxconn and a Japanese government-backed fund for the electronics company.
The embattled consumer-electronics maker recorded more than $9.91 billion in losses in its core television business during the past four years.
Apple is a company in transition — and investors have begun to see the tech giant as less of an explosive growth stock and more of a slow-and-steady value investment.
Purchasing Sharp would allow Foxconn to offer customers like Apple, Amazon and Xiaomi a more integrated manufacturing solution.
Sharp is looking to restructure its core TV business to better compete with lower-cost South Korean and Chinese rivals.
Rumors are rife that Apple will be releasing a 4-inch smartphone with iPhone 5e moniker in March.
Several iPhone suppliers have also warned of lower-than-expected revenue for the holiday quarter.