In giant 'garage sale', Japan's TV giants hawk $3 bln of assets
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Panasonic Corp, Japan's struggling maker of Viera brand TVs, owns more than 10 million square metres of office and factory space, dormitories for its workers and sports facilities for its rugby, baseball and women's athletics teams.
As it battles for Christmas shoppers' wallets in the
year-end holiday season, the sprawling electronics conglomerate is also seeking buyers for some of those properties to trim its fixed costs and improve cashflow at a time of intense competition, particularly from South Korean rivals such as Samsung Electronics Co.
Japan's other troubled TV makers, Sony Corp and
Sharp Corp, are also selling buildings and businesses
in a giant 'garage sale' that could raise a combined $3 billion.
Panasonic plans to raise $1.34 billion from offloading property and shares in other Japanese companies by end-March, the group's chief financial officer Hideaki Kawai told Reuters.
"We have a lot of land and buildings in Japan and overseas," he said in an interview at the company's head office in Osaka, in western Japan. He declined to list which properties would go on the block, but said most are in Japan.
Included is a 24-storey central Tokyo block - built in 2003
with more than 47,300 square metres and housing 2,000 Panasonic workers - a source familiar with the plan told Reuters.
Kawai added that Panasonic would raise about a quarter of the sell-off funds by getting rid of shares it owns in other companies - a common practice of cross-shareholdings in Japan.
The proceeds would help bolster free cashflow to 200 billion yen ($2.43 billion) for the business year to March, Kawai said, and allow Panasonic to reduce its debt and maintain its crucial research and development effort as it revamps its business portfolio.
It will sell more assets in the year starting in April if
cashflow dips below 200 billion yen, Kawai added. Panasonic President Kazuhiro Tsuga has promised to shut or sell businesses operating at below a 5 percent margin. Those sales could start as soon as April.
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