Sharp to have co-CEOs following Hon Hai-led turnaround

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TOKYO — Japanese electronics maker Sharp will have co-CEOs, possibly a Japanese one alongside the Taiwanese president Tai Jeng-wu, following the company’s successful return to the Tokyo Stock Exchange’s premier first section on Thursday.

Tai, an executive from Sharp’s Taiwanese parent Hon Hai Precision Industry or Foxxcon, has been saying he will step down once he achieves his mission of bringing Sharp back to the TSE first section. But in a press conference Thursday, he said, “it is my responsibility to see through the three-year business plan,” which he unveiled in May and calls for Sharp to boost its revenue by more than 50% to 3.25 trillion yen in fiscal 2019, from 2.05 trillion yen in the fiscal year ended in March.

But Tai added that, “to nurture the next president, we will consider transitioning to a co-CEO system” and devolving more of his responsibilities to the co-CEO.

“I want to quit, to be honest. I’m already 67,” Tai said. “I’ll still be in my 60s in 2020, but I won’t be able to continue after that.”

A co-CEO won’t necessarily be chosen from within, Tai said, stressing that the selection should be made on the basis of merit, but added that he wants to make the selection soon.

Shares in Japanese electronics maker Sharp have returned to the first section of the Tokyo Stock Exchange — a major milestone in the turnaround of the business being executed by the Taiwanese parent company.

Shares began trading 0.5% or 20 yen higher at 3905 yen on Thursday, but ended the morning session 1.15% or 45 yen lower at 3840.

Tai said returning to the first section mattered to him, because it allows the company to recruit high-caliber people. The company has seen many employees leaving for greener pasture as its business slumped over the years. “Human resources are critical to the future of the company,” Tai stressed.

Sharp’s return comes 16 months after it was demoted to the second tier for falling into negative equity for the fiscal year through March 2016, having struggled in its core display devices business.

Sharp was the first major Japanese electronics maker to be bought by a company from elsewhere in Asia.

Tai implemented a raft of measures to turn the company around, from cost-cutting and personnel management changes to market expansion. The company expects its bottom line for the current fiscal year to return to profit for the first time in four years.

Sharp is a major producer of liquid crystal displays, even though its major customers, such as Apple, is gradually shifting to organic light-emitting diode displays, or OLED, which offers stronger color contrast and a brighter display than LCDs.

Tai reiterated his belief that other Japanese producers of LCDs — Tokyo-based Japan Display in particular — to join forces with Sharp and Foxxcon to compete in the market, and said that he will try to persuade Japan Display’s top shareholder, the government-backed Innovation Network Corp. of Japan or INCJ.

Tai showed interest in producing OLED, but stressed that the company will proceed cautiously. “We are not interested in taking on Samsung” — the top producer of OLED. “We start where we can, and then ramp up gradually.”

Investors will be keeping a close eye on whether the momentum can be maintained, especially as the CEO has previously mooted the possibility of becoming company chairman once Sharp had achieved promotion to the first tier.

Stocks listed on the first section of the Tokyo Stock Exchange account for over 90% of the market cap of all the stocks listed. First tier stocks are more liquid, meaning investors can trade them more easily than those on the second tier