Sharp wins bank approval for $2.7bn in fresh loans

PanARMENIAN.Net - Cash-strapped Sharp Corp will win approval from its banks as early as Thursday, Sept 27, to secure as much as 210 billion yen ($2.7 billion) in fresh loans with a plan that commits the loss-making company to return to profit, a source at one of its main lenders said on Tuesday, according to Reuters.

Sharp has already submitted its proposed revival plan which must outline how it will make a profit in the six months starting Oct 1 and beyond, the source told Reuters on condition he isn't identified.

The banks may yet seek revisions to that plan before agreeing to new lending, but ultimately are expected to approve new loans that Sharp needs to stay in business because by refusing to do so they risk having to write off Sharp's existing debts.

Sharp has to repay as much as 360 billion yen of short-term commercial paper loans and needs to secure financing from lenders led by Mizuho Financial Group and Mitsubishi UFJ Financial Group.

The maker of Aquos TVs has already mortgaged nearly all of its domestic offices and factories, including one that makes screens for Apple Inc's iPhone 5, to secure up to 150 billion yen of loans.

Sharp is predicting a net income of 15 billion yen in the 12 months to March 31, 2014, compared with a net loss of 250 billion yen projected for this year, Kyodo news said on Tuesday.

Citing sources familiar with the Japanese TV maker's plan, Kyodo said Sharp was expecting an operating profit of 121.2 billion yen for the next business year. Sharp has forecast an operating loss of 100 billion yen for the current business year to next March.