A tie-up between Japanese electronics powerhouses Panasonic (s PC) and Sanyo has been in the works for a while, but today it was made official, with Panasonic saying it has agreed to buy Sanyo for ¥800 billion ($9 billion) via a public tender offer. The main focus of the deal, Panasonic said, is the combination of the solar and lithium-ion battery businesses of the two companies, as well as a strengthened financial and business position.
The companies confirmed that they were discussing a possible deal last month. Panasonic said today that the tender offer will start as soon as possible. The deal could close by February, with Sanyo becoming a part of the Panasonic group.
Sanyo brings with it a big solar panel business, and Panasonic is looking at boosting both its solar and battery divisions once the deal is closed, saying that it sees significant future growth in both markets. Panasonic said the solar business will expand in the area of highly efficient crystalline silicon solar photovoltaic cells and modules, and in the development next-generation solar cells.
Earlier this year, Sanyo announced plans to build a new $80-million, 70-megawatt solar manufacturing facility in Oregon. The plant is expected to open in October 2009, with production getting up to full capacity by April 2010.
Panasonic said it plans to make “active investments” in batteries for hybrid and electric vehicles, with the company saying that collaboration with automakers could be strengthened by the Panasonic-Sanyo deal. Earlier this week, Japan’s Honda Motor (s HMC) inked an agreement with Japanese battery maker GS Yuasa to form a ¥15 billion joint venture for the development of lithium-ion batteries for hybrid vehicles.
Panasonic may also need to watch its back in the U.S., as battery makers there formed a coalition yesterday to battle overseas competitors in the growing market for hybrid and electric car batteries. More than a dozen U.S. technology companies are teaming up to build a battery manufacturing plant there, and are reportedly asking the federal government for $1 billion to support the plan.