Panasonic To Buy Sanyo

On Nov 7 Friday, Panasonic Corp said it would acquire smaller rival Sanyo Electric Co, if this happen Panasonic will be Japan's top electronics maker.
The acquisition, which one analyst estimated could be about $8.8 billion, which could make Panasonic a tough competitor in rechargeable batteries and solar power equipments and since demand for greener energy sources as increasing this deal seems to be profitable for Panasonic Corp.

After deal Panasonic will become world's second largest conglomerate with a major electronic division, behind General Electric and surpassing Hitachi Ltd as the biggest electronics maker in Japan.

"Strategically (the deal) makes sense, though it doesn't necessarily make sense for Panasonic to take on every single bit of Sanyo Electric," said Hannah Cunliffe, fund manager at Germany's Union Investment, which holds Panasonic shares. "There has to be some relatively aggressive restructuring."
The announcement was well flagged and sources told Reuters last weekend that Sanyo and Panasonic, which sits on $10 billion in cash, had agreed in principle to a deal.

Panasonic is the world's top most plasma TV maker formerly known as Matsushita Electric and therefore want this deal to happen because Sanyo is one of the leading company in making of rechargeable batteries, which is widely used in mobile phones, laptops, music players and in cars too to increase car power.
Currently, Sanyo supplies nikel metal hydride batteries to well known Motor companies Ford Motors Co and Honda Motor Co Ltd. Also develop lithium-ion batteries for cars like Volkswagen AG.

By this deal Panasonic will enter in solar market, since Sanyo is seventh-largest solar cell maker.

In an new conference, Panasonic President, Fumio Ohtsubo, said "Adverse business conditions are making it difficult for us to achieve the kind of growth we have been striving for," he said. "We need a new growth engine within our group."