Japan's Sharp Corp. will build production lines to make small and midsized liquid crystal displays for smartphones including Apple's iPhone, a report said Friday.

Sharp will invest about 100 billion yen (1.2 billion dollars) in the project with Apple shouldering a large portion of the sum and buying most of the panels produced, the Nikkei business daily said.

A Sharp spokeswoman declined to comment on the report.

Sharp has also supplied LCD panels for Apple's iPod touch music player.

The production lines will be installed at Sharp's plant in Kameyama in the central Japan prefecture of Mie, Nikkei said.

The plant, launched in 2004 to produce large LCD panels for televisions, has been empty since Sharp sold production equipment to a Chinese electronics manufacturer last year, the daily said.

Sharp will start installing equipment next year, and mass production is scheduled to begin in the second half of 2012, according to the paper.

Smartphone demand is expanding worldwide, encouraging major investment by Japanese electronics makers. Toshiba Corp. plans to build a factory at home to boost LCD supplies to Apple, the paper said.