Panasonic to sell health-care unit to KKR & Co for $1.67 bn

Japan's Panasonic Corp is selling its health-care unit to US private equity firm KKR & Co for ¥165 billion ($1.67 billion).

Panasonic will sell about 80 per cent of its Healthcare division to the KKR & Co and retain 20 per cent, and both the companies will cooperate in managing Panasonic Healthcare Co through a joint venture.

"Japan is a very important and attractive market for KKR, and our experienced team on the ground in Japan looks forward to leveraging KKR's global expertise and experience to make this a highly successful partnership," KKR founder Henry Kravis said in a statement.

Panasonic Healthcare president, Kenji Yamane said, "KKR has built long-term relationships with its portfolio companies around the world, and I am delighted for their support as Panasonic's new partner for Panasonic Healthcare.

Looking ahead, we aim to accelerate growth by building out our global sales channels to major overseas healthcare facilities, aided by KKR's overseas network, and delivering to customers around the world an enhanced range of products and services."

The troubled consumer electronics maker, which wants to end losses in its flat-panel television business, had hired Bank of America Merrill Lynch as advisors to the sale of Panasonic Healthcare Co.

Panasonic had earlier said that it would want to sell the entire business to one buyer, although it would also consider selling it off in parts.

Toshiba Corp and a consortium that included US private equity firm Bain Capital, Japanese trading house Mitsui & Co Ltd and the Development Bank of Japan had also bid for the healthcare unit, but New York-based KKR & Co got preferential negotiating rights after two rounds of bidding.

Panasonic's Healthcare comprises of electronic medical chart systems, hearing aids and blood-sugar monitoring devices. It had reported an operating profit of 8.7 billion yen for 2012, on revenue of 134.3 billion yen.