Panasonic Corporation has agreed to acquire rival Japanese electronics maker Sanyo Electric for up to 800 billion yen ($9 billion) through a public tender offer after its three major shareholders, including Goldman Sachs, agreed to the takeover, the companies said.
Panasonic Corporation and Sanyo Electric Co Ltd said their respective boards of directors today decided to enter into a capital and business alliance agreement.
Panasonic will aim to acquire the majority of the voting rights of Sanyo assuming full dilution (which takes into account conversion of Class A preferred stock and Class B preferred stock into common stock) by means of a public tender offer bid.
Panasonic said it will commence the tender offer as soon as is practical, subject to, among other conditions, completion of the procedures and the measures that are necessary under domestic and overseas competition laws and regulations. It is expected to take a certain amount of time for the procedures of the regulatory authorities to be completed.
The deal would create one of the world's biggest electronics companies and allow Panasonic to add Sanyo's strengths in green energy - solar panels and rechargeable batteries - to its own huge product portfolio.
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.
''Panasonic has been challenging under the `Panasonic' brand to generate "ideas for life" for the future. Through innovative thinking, Panasonic is committed to enriching people's lives around the world and thereby contributing to the development of society and future of the world. On the other hand, Sanyo has been seeking to become a `Leading company for energy and environment,' which significantly contributes to enhancing the global environment and enriching people's lives through its proprietary technology and products, under its management philosophy stating. We are committed to becoming an indispensable element in the lives of people all over the world," the two said in a joint press release.
Panasonic had been negotiating with Sanyo's top three shareholders, Goldman Sachs, Daiwa Securities SMBC and Sumitomo Mitsui Banking, who were initially reluctant to sell their stakes.
Goldman, Daiwa and Sumitomo Mitsui together own Sanyo stocks equal to a combined 70.5 per cent of voting rights, or preferred shares that can be converted into common stock of about 4.3 billion shares, the statement said.
When all outstanding Sanyo shares are combined, they total about 6.1 billion.