Panasonic Corp., the Japanese consumer electronics giant has plans of selling its subsidiary Sanyo’s North American TV set business to Funai Electric. After having a detailed discussion on the business terms and conditions, Funai Electric and Panasonic will finally agree on the business deal by the end of this year. According to sources, the final sale of the unit will be done by the end of March 2015.
Due to stiff competition in North America from Chinese counterparts, Sanyo’s business has entered into rough weather there. Thus, Panasonic has plans of rapidly wrapping up the business there to prevent further losses. Sanyo purchases television sets from Chinese consumer electronics manufacturers like TCL and then supplies these to huge retail outlets like Wal-Mart under its own brand name. On an annual basis, close to 1 million television sets are bought by Wal-Mart from Sanyo.
Under this business deal, Funai will be allowed by Panasonic to sell Sanyo brand television sets to the Wal-Mart stores. Sanyo’s yearly television sales in North America are worth US$ 275 million.
Presently, Funai sells Emerson brand, Philips brand, and other LCD television sets in the North American region via the Wal-Mart stores. Since North America contributes about 70% of the total sales of Funai, in terms of shipment share, this Japanese company is the third largest market player in the global market.
It is expected that this business acquisition plan which involves divesting Sanyo’s North American television business will give a significant boost to the yearly sales of Funai by almost 20% which will entail the sale of 6 million units more.