According to Wikipedia, Hudson originally approached Sharp before pitching the idea to NEC. While Sharp was enthusiastic and agreed that it had great commercial potential, the deal ultimately fell through.

The deal-breaker was Sharp’s deep relationship with Nintendo at the time. Apparently, developing a console with Hudson’s CPU was seen as something that would have jeopardized their partnership with Nintendo.

What Sharp was working on back then was the "C1 NES TV"—basically a NES-integrated television. You could think of it as the NES era's version of the iMac. It has a bit of a comical look that always makes me smile.

https://ja.wikipedia.org/wiki/%E3%83%95%E3%82%A1%E3%83%9F%E3...

I believe Hudson did design the chipset for the Sharp X68000 though, which was a very nice machine, much better than the Amiga

The X68000 was one of those mythical machines you would catch a small hint off in European gaming magazines once in a while.

The Japanese version of that TV used an internal RGB connection with an RGB PPU, making it as clear and sharp as Nintendo's Famicom-based arcade hardware.

The US version of that TV used composite internally