May 31, 2013 / 9:51 AM / 6 years ago

Hon Hai sets up display R&D company in Japan

A security guard patrols at Hong Hai headquarters in Tucheng, Taipei county, June 8, 2010. REUTERS/Pichi Chuang

TAIPEI (Reuters) - Taiwan’s Hon Hai Precision Industry Co Ltd, said it set up a research and development company in Japan for displays and touch panels, its latest effort to strengthen its display business.

The world’s largest contract electronics manufacturer, which purchased a 38 percent stake in a Sharp Corp TV panel plant in Sakai, Japan last year, has been investing to integrate its display business as the company looks to diversify from the low-margin contract manufacturing business.

Hon Hai said in a statement that new technology developed in the center will be applied to consumer, commercial and medical products, but did not disclose the amount of the investment.

“We choose Japan to build the display R&D center because it has the proximity to the Sakai plant and it is the hub for our display business,” said Hon Hai spokeswoman Laura Liu.

Liu said the new &D center will the company’s third R&D center in Asia. The other two are in Taiwan and China and the company plans to further consolidate its R&D and technical resources in Taiwan, Japan and China.

Last year, Hon Hai’s chairman, Terry Gou, purchased a 38 percent stake in Sharp’s Sakai plant in western Japan, the world’s most advanced and only 10th-generation LCD factory.

The company is also seeking a stake in Sharp, but talks have stalled since the Japanese company’s share price plunged last year in the wake of losses.

Reporting by Clare Jim; Editing by Matt Driskill

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