UPDATE 1-Sharp drops to 5-month low on report of new share issue

Mon Apr 14, 2014 12:14am EDT

* Sharp considering raising 200 bln yen in year to next March -Asahi

* Sharp says considering various options to bolster its capital

* Shares down 7.7 pct after falling as much as 10 pct (Updates share move, adds company comment)

TOKYO, April 14 (Reuters) - Shares in Sharp Corp fell to a five-month low on Monday after the Asahi newspaper said Japan's largest display maker is considering another issue of new shares that could raise around 200 billion yen ($1.97 billion) to bolster its stretched finances.

The Osaka-based company said in a statement on Sunday that it was considering a variety of possibilities to boost its capital but had made no concrete decisions, adding that the report was not based on a release by the company.

Sharp would aim to launch the offering during the current financial year to March 2015 after a restructuring of its flagship Kameyama LCD panel factory and putting its earnings on a solid recovery path, the Asahi daily reported on Sunday.

Sharp raised about 140 billion yen in the final months of 2013 but its equity ratio - a key measure of financial stability - stood at just 13 percent at the end of December, below the 20 percent threshold that is considered healthy.

Sharp's shares were down 7.7 percent at 276 yen in Monday afternoon trade in Tokyo, after falling as much as 10 percent to a five-month low of 269 yen early in the day. ($1 = 101.6400 Japanese yen) (Reporting by Dominic Lau and Ritsuko Ando; Editing by Chang-Ran Kim and Sunil Nair)

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