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Aug 31, 2011

Panasonic to Integrate Bond Financing, Redemption and Administrative Work of Wholly-Owned Subsidiary (SANYO Electric Co., Ltd.)

Osaka, Japan, August 31, 2011 - Panasonic Corporation ([NYSE:PC/TSE:6752] "Panasonic") today announced that its Board of Directors has decided and signed an agreement to assume operations related to bond financing, redemption and administrative work of SANYO Electric Co., Ltd. (SANYO), a wholly-owned consolidated subsidiary of Panasonic, through business division. This division is expected to take effect on January 1, 2012. Details of the business division are outlined below.

1. Purpose of the Business Division

Panasonic intends to unify the operations related to bond financing, redemption, and administrative work of SANYO into Panasonic. This will enable Panasonic to unify the group-wide bond administrative operations including those related to the bonds issued by Panasonic Electric Works Co., Ltd. which are expected to be transferred to Panasonic through the merger. For detailed information of the merger, refer to the press release, "Panasonic to Absorb Wholly-Owned Subsidiary (Panasonic Electric Works Co., Ltd.)", issued on August 31, 2011.

2. Summary of the Business Division

(1) Schedule of the business division
August 31, 2011 Resolution of the Board of Directors on the business division
August 31, 2011 Signing of the business division agreement
January 1, 2012 (planned) Effective date of the business division
(Note: The business division will be conducted through a simplified procedure provided under the Company Law of Japan, by which resolutions of the shareholders' meetings of Panasonic and SANYO will not be required.)

(2) Method of the business division
SANYO will divide a certain part of its business and Panasonic will succeed to the dividend business.

(3) Allotment in relation to the business division
Panasonic is expected to pay approximately 500 thousand yen in cash to SANYO.

(4) Increase in stated capital as a result of this business division
There shall be no increase in stated capital as a result of this business division.

(5) Rights and obligations to be transferred
Panasonic will assume a certain amount of assets, liabilities, contracts, and other rights and obligations of SANYO related to this business including the bonds issued by SANYO and a certain amount of cash which is equivalent to the amount of the principal and interest of the bonds.

(6) Prospects for paying debt obligations
Panasonic believes that Panasonic will be able to fulfill its obligations which are required to be performed after the effective date of the business division.

3. Basic information of Panasonic and SANYO

(As of March 31, 2011, unless otherwise specified)
  Succeeding Company Company to transfer the business
(1) Corporate name Panasonic Corporation SANYO Electric Co., Ltd.
(2) Head office 1006, Oaza Kadoma,
Kadoma City, Osaka, Japan
5-5, Keihan-Hondori 2-Chome,
Moriguchi City, Osaka, Japan
(3) Name and title of representative President,
Fumio Ohtsubo
Executive Director and President, Seiichiro Sano
(4) Principal lines of business Manufacture and sale of electronic and electric equipment, etc. Manufacture and sale of various electronic equipments
(5) Stated capital 258,740 million yen 322,242 million yen
(6) Date established December 15, 1935 April 1, 1950
(7) Number of  shares issued 2,453,053,497 shares 6,158,053,099 shares
(8) Fiscal year end March 31 March 31
(9) Major shareholders and shareholding ratio
The Master
Trust Bank of Japan, Ltd. (trust account)
4.76%
Japan Trustee Services Bank, Ltd. (trust account)
4.41%
Moxley & Co.
3.20%
Nippon Life Insurance Company
2.73%
Sumitomo Mitsui Banking Corporation 2.32%
Panasonic Corporation
(As of April 1, 2011)
100%
(10) Operating results and financial conditions for the year ended March 31, 2011 Panasonic Corporation
(Consolidated, U.S. G.A.A.P.)
SANYO Electric Co., Ltd.
(Consolidated, U.S. G.A.A.P.)
  Net assets 2,946,335 77,926
Total assets 7,822,870 1,117,093
Shareholders' equity per share (yen) 1,236.05 10.44
Net sales 8,692,672 1,489,497
Operating profit 305,254 33,575
Ordinary income - -
Net income (loss) attributable to the company 74,017 (35,161)
Net income (loss) per share attributable to the company per share (yen) 35.75 (5.73)

Notes:

1. In millions of yen, unless otherwise specified.
2. As of June 30, 2011, Panasonic holds 140,807,803 shares, 5.74%, of its common stock.
3. The number of shares held by The Master Trust Bank of Japan, Ltd. (trust account) reflects the shares entrusted by Mitsubishi UFJ Trust and Banking Corporation and other corporations, which have been originally entrusted with such shares in their trust services.
4. The number of shares held by Japan Trustee Services Bank, Ltd. (trust account) reflects the shares entrusted by The Sumitomo Trust and Banking Co., Ltd. and other corporations, which have been originally entrusted with such shares in their trust services.
5. The item "Ordinary income" is omitted since it does not exist under the United States Generally Accepted Accounting Principles (U.S. G.A.A.P.), which have been adopted by Panasonic and SANYO on a consolidated basis.
6. Figures related to the discontinued semiconductor business are excluded from the operating results and financial conditions of SANYO.

4. Description of the Business to be Succeeded

(1) Outline of the business to be succeeded
Bond financing, redemption, and administrative work of SANYO

(2) Operating results of the business to be succeeded
There are no entries regarding operating results of the business to be succeeded.

(3) Assets and liabilities of the business to be succeeded (As of March 31, 2011)

(billion yen)
Assets Liabilities
Item Book value Item Book value
Current assets 40.0 Current liabilities 0
Fixed assets 0 Fixed liabilities 40.0
Total 40.0 Total 40.0

Notes:

1. Amounts less than 100 million yen have been rounded to the nearest whole 100 million yen amount.
2. The assets and liabilities of the business actually succeeded will be measured at fair value on the effective date.

5. Conditions after the Business Division

Corporate name, head office, name and title of representative, principal lines of business, stated capital and fiscal year end of Panasonic shall not be changed as a result of the business division.

6. Effect on Financial Outlook

There shall be no effect on the consolidated financial outlook of Panasonic for fiscal year ending March 31, 2012.

Disclaimer Regarding Forward-Looking Statements

This press release includes forward-looking statements (within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934) about Panasonic and its Group companies (the Panasonic Group). To the extent that statements in this press release do not relate to historical or current facts, they constitute forward-looking statements. These forward-looking statements are based on the current assumptions and beliefs of the Panasonic Group in light of the information currently available to it, and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause the Panasonic Group's actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. Panasonic undertakes no obligation to publicly update any forward-looking statements after the date of this press release. Investors are advised to consult any further disclosures by Panasonic in its subsequent filings with the U.S. Securities and Exchange Commission pursuant to the U.S. Securities Exchange Act of 1934 and its other filings.
The risks, uncertainties and other factors referred to above include, but are not limited to, economic conditions, particularly consumer spending and corporate capital expenditures in the United States, Europe, Japan, China and other Asian countries; volatility in demand for electronic equipment and components from business and industrial customers, as well as consumers in many product and geographical markets; currency rate fluctuations, notably between the yen, the U.S. dollar, the euro, the Chinese yuan, Asian currencies and other currencies in which the Panasonic Group operates businesses, or in which assets and liabilities of the Panasonic Group are denominated; the possibility of the Panasonic Group incurring additional costs of raising funds, because of changes in the fund raising environment; the ability of the Panasonic Group to respond to rapid technological changes and changing consumer preferences with timely and cost-effective introductions of new products in markets that are highly competitive in terms of both price and technology; the possibility of not achieving expected results on the alliances or mergers and acquisitions including the business reorganization after the acquisition of all shares of Panasonic Electric Works Co., Ltd. and SANYO Electric Co., Ltd.; the ability of the Panasonic Group to achieve its business objectives through joint ventures and other collaborative agreements with other companies; the ability of the Panasonic Group to maintain competitive strength in many product and geographical areas; the possibility of incurring expenses resulting from any defects in products or services of the Panasonic Group; the possibility that the Panasonic Group may face intellectual property infringement claims by third parties; current and potential, direct and indirect restrictions imposed by other countries over trade, manufacturing, labor and operations; fluctuations in market prices of securities and other assets in which the Panasonic Group has holdings or changes in valuation of long-lived assets, including property, plant and equipment and goodwill, deferred tax assets and uncertain tax positions; future changes or revisions to accounting policies or accounting rules; natural disasters including earthquakes, prevalence of infectious diseases throughout the world and other events that may negatively impact business activities of the Panasonic Group; as well as direct or indirect adverse effects of the Great East Japan Earthquake on the Panasonic Group in terms of, among others, component procurement, manufacturing, distribution, economic conditions in Japan including consumer spending and sales activities overseas. The factors listed above are not all-inclusive and further information is contained in Panasonic's latest annual reports, Form 20-F, and any other reports and documents which are on file with the U.S. Securities and Exchange Commission.

In order to be consistent with generally accepted financial reporting practices in Japan, operating profit (loss) is presented in accordance with generally accepted accounting principles in Japan. The company believes that this is useful to investors in comparing the company's financial results with those of other Japanese companies. Under United States generally accepted accounting principles, expenses associated with the implementation of early retirement programs at certain domestic and overseas companies, and impairment losses on long-lived assets are usually included as part of operating profit (loss) in the statement of income

Media Contacts:

Akira Kadota (Japan)
Global Public Relations Office
(Tel: +81-3-6403-3040)
Panasonic News Bureau (Japan)
(Tel: +81-3-3542-6205)
Jim Reilly (U.S.)
(Tel: +1-201-392-6067)
Anne Guennewig (Europe)
(Tel: +49-611-235-457)

Investor Relations Contacts:

Makoto Mihara (Japan)
Investor Relations
(Tel: +81-6-6908-1121)
Yuko Iwatsu (U.S.)
Panasonic Finance (America), Inc.
(Tel: +1-212-698-1360)
Hiroko Carvell (Europe)
Panasonic Finance (Europe) plc
(Tel: +44-20-3008-6887)
*The content in the following news releases is accurate at the time of publication but may be subject to change without notice. Please note therefore that these documents may not always contain the most up-to-date information.

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Global Home You are here:About Panasonic > containsNews > containsHeadquarters News > containsPanasonic to Integrate Bond Financing, Redemption and Administrative Work of Wholly-Owned Subsidiary (SANYO Electric Co., Ltd.)