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Japan's Sharp denies talks with Intel on capital tie-upUS-SHARP-INTEL:Japan's Sharp denies talks with Intel on capital tie-up
TOKYO (Reuters) - Japan's Sharp Corp has denied a Japanese newspaper report it is in talks with U.S. chipmaker Intel Corp on a capital alliance that would offer a possible lifeline to the troubled TV maker as discussions with Taiwan's Hon Hai Precision Industry Co stall.
Sharp spokeswoman Miyuki Nakayama denied the report in Japan's Mainichi newspaper, which reported on Friday without citing sources that the companies were in talks for Intel to invest more than 30 billion yen ($383 million) in Sharp, potentially making it Sharp's top shareholder.
An Intel spokesman declined to comment.
The paper said the two could reach a deal as early as next month, although Sharp will also continue its capital tie-up discussions with Hon Hai, it added.
Sharp said last week that talks to make Hon Hai its biggest shareholder had made no progress recently as the Taiwanese company seeks a management role in return for its capital.
The two had been expected to conclude an agreement for Hon Hai to buy a 9.9 percent stake in Sharp during a visit to Japan by Hon Hai Chairman Terry Gou in August, but Gou left early without seeing Sharp executives.
Sharp, hammered by losses in its TV and LCD panel businesses amid a strong yen and tough competition from overseas rivals, expects a net loss of 250 billion yen in the year to March 2013, after losing 376 billion yen in the last financial year.
The bigger-than-anticipated losses have pushed Sharp's shares down by more than two-thirds in the year to date. They closed at 202 yen on Thursday.
Intel is attracted by Sharp's technology for small and midsize liquid crystal display (LCD) panels, the Mainichi said.
Earlier this year, Intel signed deals with several panel makers to ensure adequate supplies for a wave of Ultrabook laptops with touch screens expected to hit the market following Microsoft's launch of Windows 8 in late October.
Ultrabook computers are Intel's big bet to reinvigorate a PC industry that is stagnating due to consumers' growing preference for tablets and smartphones.
But critics say costly features like touch screens and solid-state drives may make Ultrabooks too expensive for many consumers.
($1 = 78.2450 Japanese yen)
(Reporting by Chris Gallagher and Chang-Ran Kim in TOKYO, Noel Randewich in SAN FRANCISCO; Editing by Chang-Ran Kim and Eric Meijer)
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