Apple Inc (NASDAQ:AAPL) is one party that has been deeply involved in the Japan Display bailout story. Japan Display was frustrated upon one lead company walking out on a plan to rescue its business. However, this new month comes with good tidings for the company. Apple’s intervention will seemingly save it.
This is a story that started in 2016 when Japan Display reported that it was struggling to sell its LCD orders. It had witnessed a drastic drop in orders after smartphone manufacturers shifted to using OLED from LCD.
Japan Display needed to find a solution, but that would be difficult considering that it had insufficient capital. The build-up of the OLED production lines was a rather expensive undertaking, and so it couldn’t afford it. This was a business shift requiring it to use about $636 million. Japan Display needed to appeal to the government to bail it out so it could stay afloat and also resort to OLED manufacture.
In the meantime, Apple had been facing immense pressure from leading companies, all of them wanting to do business with it. Apple didn’t manage to save the company, and so Japan display continued struggling. The hope was that one day, it would have enough at hand to set in place large-scale OLED screen production.
After a while, it was time for a second bailout. Apple channeled a $1.5 billion loan to the company as a loan to be repaid later. The plan was for the company to engage in a wide-scale LCD production.
Apple shines after lead supporters leave
The new success was short-lived after one supporter walked out of the rescue plan. Apple wanted to see Japan Display succeed and in that effect, gave it another $100 million. That helped Japan Display balance its books somehow. However, that didn’t make things look good for the OLED iPhone displays. That seemed to be a dream to be achieved two years later. It wasn’t long before a second backer of the plan exited again.
Japan Display remains optimistic all the same. It is looking forward to getting a deal of about 50 billion yen ($470 million) in funds. An official working with the company reveals Apple’s plan to direct about t $200 million into the deal. Apple’s move is going to make it the single largest contributor in this fund targeted at lifting Japan Display.