Rebirth of England.

Chapter 726: Investing in Sharp
Throughout 2009, with the development of mobile Internet in many parts of the world, users' demand for smartphones began to increase.

According to the research results of relevant institutions, in 2009, the sales revenue of global mobile phone manufacturers reached 1560 billion US dollars, and the total sales volume of mobile phones exceeded 11 billion units.

A considerable number of these are still traditional feature phones, but the smartphone market has been booming since the second half of 2008, and it is the only type of mobile phone with continued growth in sales and sales volume.

According to forecasts, smartphone sales will continue to grow in the next five years. The global smartphone market is set to undergo a major transformation in 2010, with annual shipments expected to exceed 3.2 million units.

In the field of smartphones, Nokia is still the world's largest smartphone manufacturer. In 2009, Nokia-branded smartphone shipments accounted for about 32% of total smartphone sales. However, Nokia's achievements mainly come from cheap smartphones sold in markets such as China and South America. The North American market is still the biggest problem facing Nokia.

Ranked second among smartphone manufacturers is Honor Electronics' Mate series of phones, which has a global market share of over 19%, nearly 16 percentage points higher than Apple's iPhone series' 3%.

If Honor Electronics' mid- and low-end Dopod brand smartphones are added, Honor Electronics' share of the global smartphone market will be as high as 30%, second only to Nokia. Considering that Nokia can only maintain the low-end smartphone market and its share is gradually shrinking, it is likely that in 2010, its position as the number one in smartphone shipments will be handed over to Honor Electronics.

The remaining two mobile phone manufacturers, Samsung and BlackBerry, accounted for 8% and 5% of smartphone shipments respectively.

Because they misjudged the situation and placed their bets on the GOS system for smartphones, Motorola only launched one Android-based phone last year, and three GOS-based phones. As a result, its overall shipments plummeted, and its market share in the smartphone market is less than 1%...

The situation is even worse for Japanese mobile phone manufacturers such as Sony Ericsson and Sharp. In this year's smartphone market share, all of them are classified as other brands...

Yes, from the current perspective, judging from the shipment volume of smartphones alone, the GOS system is not very successful. Among the three touch-screen smartphone operating systems, iOS, Android and GOS, the Android system, with its rich variety of manufacturers and models, occupies nearly 60% of the market share (only counting the shipment volume of phones with the three operating systems), the iOS system occupies more than 30%, and the GOS system's market share is less than 10%!

2010年的1月5日，荣耀电子和倭国的夏普公司共同宣布，荣耀电子将出资640亿日元（约合8亿美元）收购夏普公司已发行股份的9.9%的股票，成为夏普公司的股东之一。

Honor Electronics' move is to consolidate their supply chain. After all, Sharp was once the inventor and leader of global LCD technology. Even though South Korean LCD panel suppliers including Samsung and LG have posed a threat to it, the LCD screens produced by Sharp are still one of the best quality products on the market.

In order to consolidate the quality of Honor Electronics' current Mate series of mobile phones and cope with the competition from South Korea's Samsung Electronics in this field, they naturally need to have a stable supply chain of high-quality mobile phone LCD panels. Although Honor Electronics has invested in Chinese manufacturers as early as last year to help them speed up the research and development and production of LCD screen technology, at present, the quality of these mobile phone LCD screens is still slightly inferior to that of Japanese and Korean products, and can only be used on the lower-end Dopod brand. Honor Electronics' most core and most successful Mate series of mobile phones still need high-quality LCD screens produced in Japan and South Korea.

Apart from Sharp, this kind of LCD screen can only be obtained from Samsung and LG in South Korea. However, it should be noted that South Korean manufacturers have formed an industrial alliance, and Honor Electronics also needs to guard against the other party cutting off its supply of mobile phone LCD screens. Therefore, while Japan is being shorted on a large scale and Sharp's LCD business has a slight overcapacity, choosing this opportunity to acquire shares in Sharp is also an important move for Honor Electronics.

Baron knew that in his previous life, Taiwan's OEM manufacturer Foxconn intended to invest in Sharp in 2012, and the two parties had even agreed on a price. However, because Sharp's stock price suddenly plummeted at that time, Foxconn was ready to lower the price, but was rejected by Sharp, thus missing out on this investment opportunity.

However, Foxconn did not give up. Four years later, taking advantage of the complete decline of Sharp, it completed the acquisition of Sharp for 3888 billion yen (about 32.5 billion US dollars), thereby controlling the company with a 66% stake.

Of course, if Honor Electronics wants to acquire shares in Sharp now, since their situation is much better than it will be more than six years later, the amount of money they need to pay for the same shares will be much higher.

However, this investment is strategic and very important for Honor Electronics to consolidate its position in the smartphone market at this time. Therefore, it is not possible to wait six years to acquire it at a lower price. After HTC first launched the Android-based smartphone, its shipments once matched or even exceeded Apple, but later it declined. Honor Electronics must not experience this lesson again.

In fact, Sharp's most important business is its LCD panel business, and its LCD panels are mainly produced in Japan.

Because the shipment volume of Japanese mobile phone brands is very limited at this time, Sharp naturally needs to consider the sellers of their mobile phone LCD panels. So after Honor Electronics negotiated with them, the two parties hit it off and reached a cooperation agreement.

"In addition to the cutting-edge liquid crystal technology related to low-temperature polysilicon (LTPS) for high-definition liquid crystal panels and the organic light-emitting diode technology under development, Sharp also has six major product technologies, including medium-sized liquid crystal panels, multi-function office machines and enterprise solutions for robotics, IoT home appliances, automotive and industrial electronic components, and energy and solar energy. Therefore, not only Honor Electronics, but many of our other businesses can be technologically strengthened through the acquisition of Sharp..."

This was what Barron discovered after seeing the relevant information about Sharp Corporation. Therefore, they were determined to acquire Sharp Corporation. After all, Sharp also had some good technologies in the fields of home appliances, automobiles and energy. However, this would only be possible after opportunities appeared in the future.

Currently, Sharp Corporation can only accept investments and shares. It has not reached the end of its rope, and they will not be willing to be acquired.

(End of this chapter)