Japan Display would not turn down a partnership with struggling rival Sharp amid speculation that Japan Display's top investor wants a tie-up between the two. People "close to the matter" have told Reuters that the fund, Innovation Network Corp of Japan, was considering investing in Sharp's liquid crystal display (LCD) unit to broker a merger or partnership with Japan Display.

Sources have also said Sharp's banks are telling it to find a buyer for all or part of its ailing LCD business within months. B

"If there are such discussions, we would not say no, from the perspective of protecting Japan's manufacturing technology," Japan Display Chairman and Chief Executive Mitsuru Homma told reporters on Monday.

"I believe they have extremely valuable technology, manufacturing technology that we don't have."

He also said he saw a threat in any deal that would result in Sharp's technology "going to a third country", addressing speculation Sharp could tie up with mutual rival Hon Hai Precision Industry Co Ltd of Taiwan.

Sharp has not provided any comment.