Panasonic offers $10.96B for Sanyo

Japan’s largest consumer electronics company, Panasonic, intends to offer up to 800-billion yen ($10.96 billion) public tender offer for shares of Sanyo Electric with the hope of acquiring a majority stake in its smaller rival, it said Friday.

The deal would create one of the world’s biggest electronics companies and allow Panasonic Corp. to add Sanyo Electric Co.’s strengths in green energy — solar panels and rechargeable batteries — to its sprawling product lineup.

Panasonic, which makes Viera TVs and Diga Blu-ray disc players, said last month it was interested in acquiring Sanyo. Sanyo, which has been struggling to turn around its business, also expressed interest in the alliance.

Kazumasa Kubota, analyst with Okasan Securities Co. in Tokyo, said Panasonic was getting a good deal at the tender price of 131 yen ($1.78) a share. The offer, which has been anticipated for several weeks, was finalized at board meetings of the two companies on Friday and could see Sanyo become a unit of Panasonic within the first quarter of 2009. Panasonic sees several benefits in acquiring Sanyo.

The company is the world’s biggest manufacturer of lithium-ion batteries and an innovator in green-energy products such as solar cells, which are both business areas Panasonic is keen to get into. Panasonic has a sizeable battery business and sees a combination of the two companies as key to growing in the emerging hybrid electric vehicle market and electric vehicle market. Panasonic also thinks it can grow Sanyo’s solar business.

The two companies are also linked in history. When Konosuke Matsushita started Matsushita Electric Devices Manufacturing Co., the forerunner to today’s Panasonic, in 1918 to make electric plug adapters for light sockets he took on a small number of staff including brother-in-law Toshio Iue. In 1947 Iue would go on to start Sanyo Electric. Today the two companies remain based in Osaka and their headquarters are only a short drive apart.

The acquisition, which is unusual in Japan’s conservative business world, has been the subject of discussions between Panasonic and Sanyo’s three biggest shareholders for the last few weeks.

Japanese financial groups Sumitomo Mitsui and Daiwa Securities and U.S.-based Goldman Sachs bought roughly

Would you recommend this article?

Share

Thanks for taking the time to let us know what you think of this article!
We'd love to hear your opinion about this or any other story you read in our publication.


Jim Love, Chief Content Officer, IT World Canada

Featured Download

Featured Articles

Cybersecurity in 2024: Priorities and challenges for Canadian organizations 

By Derek Manky As predictions for 2024 point to the continued expansion...

Survey shows generative AI is a top priority for Canadian corporate leaders.

Leaders are devoting significant budget to generative AI for 2024 Canadian corporate...

Related Tech News

Tech Jobs

Our experienced team of journalists and bloggers bring you engaging in-depth interviews, videos and content targeted to IT professionals and line-of-business executives.

Tech Companies Hiring Right Now