Sharp Corp <6753.T> and Hon Hai Precision Industry <2317.T> are still discussing details of a partnership deal, a Sharp spokeswoman said on Friday, after shares in the troubled Japanese TV maker sank on worries that the agreement was in trouble.
Hon Hai Chairman Terry Gou, seeking to further tap Sharp's expertise to make more display panels for Apple's iPhones and consumer electronics, is considering a deal that would make Hon Hai the biggest shareholder in Sharp with at least a 9.9 percent stake.
Some investors had expected the two companies to announce a deal on Thursday when Gou visited Sharp's flagship LCD panel factory in Sakai, western Japan. Gou, who skipped a planned media briefing, left Japan on Thursday, sources close to the matter said.
"The two companies are still discussing the details," said Sharp spokeswoman Miyuki Nakayama, adding that officials from the companies may meet on Friday.
Commenting on Gou's apparent departure, she added: "That's nothing to do with the talks. It was his schedule."
Sharp shares tumbled 11 percent on Friday morning as uncertainty remained over Hon Hai's investment. Shares in the firm had rebounded strongly on expectations of the deal.
The Taiwanese company had agreed to pay 67 billion yen (540 million pounds), or 550 yen a share, for 9.9 percent of Sharp in March, but reopened talks in August to seek a lower price after the LCD TV pioneer's stock slumped below 200 yen while mounting losses put a question mark over its future.
Gou has said that whether he takes a stake in Sharp will depend on whether the Japanese firm will take his advice on how to restore profits.
Sharp, which takes its name from the ever-sharp mechanical pencil it invented a century ago, needs backup from Hon Hai if it is to remain viable in the long term, investors say.
(Reporting by Dominic Lau and Tim Kelly, Writing by Linda Sieg; Editing by Chris Gallagher)