Panasonic's Tender Offers For Subsidiaries To Top Y800bn

OSAKA (Nikkei)--Panasonic Corp. (6752) on Thursday announced plans for tender offers totaling up to 818.4 billion yen to turn group firms Sanyo Electric Co. (6764) and Panasonic Electric Works Co. (6991) into wholly owned units next spring.

"Speeding up strategy execution is essential in responding to competition from South Korean firms and others overseas," Panasonic President Fumio Ohtsubo told a joint news conference Thursday night.

The three firms plan to reorganize business operations by around January 2012 and unify brands under the Panasonic name in principle. They aim to generate 60 billion yen in synergies on an operating profit basis in fiscal 2012 by unifying the management of businesses in such growth fields as energy and the environment.

Panasonic now owns 50.2% of Sanyo and 51.8% of Panasonic Electric Works. It has set tender offer prices for these units at 138 yen and 1,110 yen, respectively, representing 21% and 22% premiums over their average closing prices in the past month through Wednesday. Panasonic is poised to spend around 422.2 billion yen for Sanyo and roughly 396.2 billion yen for Panasonic Electric Works should all shareholders tender their holdings.

The tender offers will run from Aug. 23 to Oct. 6, with no upper or lower limits on the number of shares. Panasonic will conduct a stock swap for remaining shares in the two units. Sanyo and Panasonic Electric Works will be delisted after becoming 100% units around next April.

Panasonic on Thursday also filed a 500 billion yen shelf registration for new shares with the Kanto Local Finance Bureau, paving the way for a capital increase down the road to finance the tender offers.

(The Nikkei July 30 morning edition)