Panasonic may acquire Sanyo Electric

OSAKA, Nov. 1 Kyodo - Panasonic Corp. is considering buying Sanyo Electric Co. by acquiring some of
the preferred Sanyo shares that three major creditor institutions, including
Goldman Sachs Group Inc. of the United States, now hold, informed sources said
Saturday.
Panasonic is expected to strike a basic agreement on the plan with Sumitomo
Mitsui Banking Corp. and Daiwa Securities SMBC Co. as well as Goldman Sachs,
possibly by the year's end, the sources said.
Panasonic would secure a dominant global market share in the lithium-ion
battery business and would obtain the photovoltaic cell business by acquiring
Sanyo.
The deal, if realized, would mark the first full-scale realignment of the
Japanese electronics industry involving major companies.
In 2006, struggling electronics maker Sanyo issued preferred shares worth a
total of 300 billion yen to the three financial institutions. If converted into
common shares, the stock will represent about 70 percent of Sanyo's outstanding
issues in terms of voting rights.
Buying the 70 percent share would cost Panasonic about 620 billion yen if
calculated using the current Sanyo share price. Sanyo closed at 145 yen on the
Tokyo Stock Exchange Friday, down 1 yen from the previous day.
The proposed stock acquisition would place Sanyo Electric under the Panasonic
Group's wing.
Combined group sales of Panasonic and Sanyo Electric totaled about 11.22
trillion yen in fiscal 2007, surpassing the 10.9 trillion yen industry leader
Hitachi Ltd. logged the same fiscal year.
Panasonic changed its corporate name to the current one from Matsushita
Electric Industrial Co. in October. The group has been looking for ways to
promote merger and acquisition activities in a bid to attain consolidated sales
of 10 trillion yen in the 2009 business year.
Sanyo founder late Toshio Iue was a relative of Matsushita founder late
Konosuke Matsushita, and worked for Matsushita before establishing Sanyo in
1947.
==Kyodo