A visitor looks at a display showing Panasonic network loudspeakers during the IFA Electronics show in Berlin. The firm will spend around ¥200bn on acquisitions in the fiscal year that kicks off in April alone, chief executive Kazuhiro Tsuga said at a briefing yesterday.
Reuters/Tokyo
Japanese electronics supplier Panasonic Corp said it was ready to spend ¥1tn ($8.4bn) on acquisitions over the next four years, emboldened by a stronger profit outlook for its automotive and housing technology businesses.
Chief Executive Kazuhiro Tsuga said at a briefing yesterday that Panasonic doesn’t have specific acquisition targets in mind for now. But he said the firm will spend around ¥200bn on M&A in the fiscal year that kicks off in April alone, and pledged to improve on Panasonic’s patchy track record on big deals.
“With strategic investments, if there’s an opportunity to accelerate growth, you need funds. That’s the idea behind the 1tn yen figure,” he said. Tsuga has spearheaded a radical restructuring at the Osaka-based company that has made it one of the strongest turnaround stories in Japan’s embattled technology sector.
Tsuga previously told Reuters that company was interested in M&A deals in the European white goods market, a sector where Panasonic has comparatively low brand recognition.
The firm said yesterday it’s targeting operating profit of ¥430bn in the next fiscal year, up nearly 25% from the ¥350bn it expects for the year ending March 31.
Panasonic’s earnings have been bolstered by moving faster than peers like Sony Corp and Sharp Corp to overhaul business models squeezed by competition from cheaper Asian rivals and caught flat-footed in a smartphone race led by Apple Inc and Samsung Electronics. Out has gone reliance on mass consumer goods like TVs and smartphones, and in has come a focus on areas like automotive technology and energy-efficient home appliances.
Tsuga also sought to ease concerns that an expensive acquisition could set back its finances, which took years to recover from the deal agreed in 2008 to buy cross-town rival Sanyo for a sum equal to about $9bn at the time.
Without referring to that deal by name, Tsuga said Panasonic had learnt from its past record and would make sure such deals would “not leave a legacy of losses”.
