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Panasonic takes over Sanyo

Posted: 23 Dec 2008 ?? ?Print Version ?Bookmark and Share

Keywords:Panasonic-Sanyo deal? rechargeable battery? solar cell?

Goldman Sachs has finally sold its stake in Sanyo Electric Co. to Japanese electronics conglomerate Panasonic Corp., clearing the way for Japan's largest consumer electronics acquisition.

Panasonic will now control just over 70 percent of the shares in Sanyo. The deal, confirmed Dec. 19 values Sanyo at Y807 billion ($9.04 billion and will increase revenues at Panasonic by 20 percent to Y11,000 billion.

The deal is not focused on either company's traditional product lines but rather on solar cells and rechargeable batteries for hybrid and electric cars. The companies said they hope to collaborate on tapping the growing market for these.

The deal will also allow Panasonic to immediately enter the solar panel business. Goldman had rejected two previous Panasonic bids and last month briefly walked away from negotiations, but it ultimately accepted a deal close to the Japanese company's terms of Y131 ($1.45) per share.

Executives at Panasonic and Sanyo endorsed the proposed acquisition last month and Sumitomo and Daiwa, two other significant shareholders, have also been pushing for a deal. But Goldman and Panasonic struggled to bridge a wide gap in their valuation of Sanyo.

Panasonic initially offered Y120 ($1.33) a share, and Goldman suspended talks after rejecting a second offer of Y130 ($1.44) a share. Its brinkmanship does not appear to have rattled Panasonic executives.

Panasonic was forced to slash its operating profit forecast by 40 percent late last month amid stiffening competition and slower sales.

- John Walko
EE Times Europe

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