JDI plans to raise funds to increase production of LCD panels | respond to Apple orders

The Nihon Keizai Shimbun learned that Japan Display Corporation (JDI), which is currently undergoing operations, is discussing raising about 50 billion yen worth of funds. In addition to implementing a capital increase of more than 30 billion yen in third-party allotments, it will also raise funds through initiatives such as the sale of assets. The company plans to accept funding from several domestic and foreign investment funds. For the new LCD panel for smartphones that Apple Inc. is scheduled to market this autumn, the Japanese monitor has received a large number of orders. The funds will be used to purchase parts and equipment. To increase production of LCD panels.

Japan Monitor discusses raising funds to increase production of LCD panels (Ishikawa Factory of Japan Display = Kawai-cho, Ishikawa Prefecture)

Japan's display seems to be making final adjustments to the amount of funds invested with a number of investment funds that are the recipients of capital increase. It is expected that the results will be announced in the near future.

Japan's monitor has suffered a total loss for the fourth fiscal year ending in fiscal year 2017 (as of March 2018). In 2017, the largest customer, Apple of the United States, used organic EL panels as the flagship model of the iPhone, resulting in the company’s smartphone LCD panel. The volume of orders has decreased, and cash flow has continued to fall into difficult conditions.

However, the sales of smart phones with Apple's organic EL screens are less than expected. The company has now begun to "return to the LCD panel." The new iPhone, which will be available this fall, has decided to adopt the Japanese display's LCD panels, with orders exceeding expectations. Before the new iPhone is added to the market, it is necessary to ensure the purchase of spare parts.

Restructuring the financial infrastructure has become a top priority for the Japanese monitor. In August 2017, it proposed the establishment of a “partnership with global companies” to explore capital cooperation with overseas business companies. It has also partnered with the most powerful partners – many Chinese panel companies. Advancing consultations, however, negotiations on relevant conditions have not proceeded smoothly. It is expected that no cooperation can be reached before the deadline for publishing the partner's announcement by the end of March 2018. Therefore, it has turned to discussions on other financing methods.

The total market value of Japanese monitors on March 29 is approximately 120 billion yen. If a third-party allotment of capital increase of more than 30 billion yen is implemented, dilution of equity will be unavoidable, and therefore it is likely to be opposed by existing shareholders.