Sharp Corp.'s lawyers are recommending that two board members be excluded from a final vote on competing bailout plans, possibly tipping the balance in favor of a proposal from Innovation Network Corp. of Japan, people with knowledge of the matter said.
Masahiro Sumita and Shinichi Saito, supporters of a bid from Foxconn Technology Group, face a potential conflict of interest because they work at Japan Industrial Solutions Ltd., a holder of Sharp preferred stock, the people said, asking not to be identified as the information is private. Sharp's board could make a final decision on the rescue plans as early as Saturday, one of the people said.
Saddled with debt and struggling with chronic losses, the board of the century-old consumer electronics maker has to decide between INCJ's plan to restructure by spinning off businesses or staying as one under a foreign parent with Taiwan's Foxconn. Sharp's fate is regarded as a test case of Japan's willingness to embrace overseas investors.
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