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The decision making process took a sudden turn a week ago. Japanese electric appliance maker, Sharp, decided on Thursday that it would give the highest priority to negotiation with Hon Hai Precision Industry in Taiwan for introducing management support. While the likeliest partner had been Innovation Network Corporation of Japan for reorganization of Sharp a week ago, Hon Hai turned over the race with ambitious deals. One of the Japanese top runners in the technology of household appliance is going to be under control of foreign company.

In the meeting of board of governors on Thursday, it was reconfirmed that human resource for Sharp’s reorganization would mostly be provided to the negotiation with Hon Hai. Hon Hai reportedly offered ¥700 billion for taking Sharp over. If the deal successfully stands, it will be the biggest acquisition of Japanese manufacturer by foreign capital.

The most viable plan, with engagement of Ministry of Economy, Trade and Industry, had been the offer of ¥300 billion from INCJ with ¥350 billion of financial support from two mega-banks, Mitsubishi Tokyo UFJ and Mizuho. But, the biggest inferiority of the plan was to separate the section of liquid crystal display from Sharp and transfer to Japan Display Inc. Integration of two major producers of liquid crystal display may take certain period of time for examination over anti-trust regulations. There were also negative arguments in Sharp over dissolution of its business.

In the meeting with board members in Sharp on January 30^th, Hon Hai Chiairman, Guo Tai-ming, offered ¥600 billion and maintenance of employment, denied partial sales of the businesses, and did not require additional financial support. To the reorganization plan of INCJ, there were criticisms from overseas on exclusion of foreign capital or governmental support for private company with tax money. Sharp had been demanded making a fair decision.

Consolidated financial report of Sharp from April to December 2015 marked ¥108 billion of deficit, jumping up from ¥7 billion in the same period of the previous year. Sharp had to settle the discussion as soon as possible. Hon Hai had to win the deal to take a great step to be an international appliance company, getting rid of an image of subcontractor of Apple. Sharp had to be one of the most preferable targets to diversify its business.

There still exists in Sharp a negative image on Hon Hai, remembering a failure of investment in 2012. Some regret about outsourcing of advanced technology of Sharp out of Japan. “It is inevitable in capitalism, anyway,” told one worker for Sharp in TV report. It can be a defeat of Japanese industrial model in dynamism of international businesses.