Dec 19, 2008, 7:51 GMT
Tokyo - Japanese electronics giant Panasonic Corp and its smaller competitor Sanyo Electric Co have announced their agreement to a business alliance Friday, sealing Sanyo's takeover.
Panasonic will take control of about 70.5 per cent of Sanyo's shares after US investment bank Goldman Sachs, which is one of Sanyo's major shareholders together with two Japanese investment firms, agreed to the deal on Thursday.
Sanyo's management threw its support last month behind the takeover, which would create one of the world's largest consumer electronics companies.
Goldman Sachs had originally refused Panasonic's 130-yen-per-share (1.47-dollar-per-share) offer as too low, but Panasonic president Fumio Ohtsubo reached an agreement with Goldman Sachs late Wednesday, news reports said.
Sumitomo Mitsui Banking Co and Daiwa Securities SMBC Co, Sanyo's two other major shareholders, had already agreed to the deal.
Panasonic, a leading maker of plasma television sets, was expected to buy the Sanyo shares for 131 yen (1.49 dollars) via a tender offer in February, valuing Sanyo at 560 billion yen, the paper said.
It is the first complete takeover of a large Japanese electronics company by a domestic competitor, putting Panasonic on par with Hitachi, Japan's largest consumer electronics producer saleswise.
The deal makes Panasonic the world's leading maker of rechargeable batteries. Sanyo is the number one producer of lithium-ion batteries for PCs and mobile phones and is also strongly positioned in the field of solar cell production.
Panasonic will gain a favorable position in these fast-growing markets, which it regards as future growth markets, as demand in plasma TVs is stalling.
Sanyo has long been the weakest link among Japan's electronics companies, battered by low profits, doctored balance sheets and management deficits.
Panasonic, on the other hand, has been undergoing a major restructuring phase. In October it changed its name from Matsushita Electric Industrial to Panasonic as a sign of its modernization drive.
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