Japan’s Panasonic announced its plans to sell its Sanyo unit to the Chinese white-goods firm Haier last week (see Haier Acquires Sanyo). According to Reuters:
China’s Haier will buy Panasonic Corp’s Sanyo Electric washing machine and refrigerator units in Japan and Southeast Asia for about $130 million, in a move that will give the Chinese appliance giant better access to the world’s third-largest economy, sources said.
At face value, this news seemed rather uneventful. Companies sell divisions all the time. It is not at all uncommon for companies to divest small divisions in an effort to restructure operations and rationalize businesses in order to focus on more strategic, and profitable, business segments.
However, there were several facets of this deal that caught my attention.
- Although M&A deals have increased in recent years, it is still relatively rare for large Japanese firms to divest assets.
- Not only did a large, Japanese firm (Panasonic) decide to sell a division, but it sold the division to a foreign firm
- And finally, not only did Panasonic decide to sell to a foreign buyer, but to a Chinese buyer (Haier) no less. Given the history of tempestuous relations between China and Japan, this struck me as most surprising.
Given that background, it will be interesting to follow this deal in the coming years to see whether Haier is able to capitalize on this purchase to make inroads in the broader Asian white-goods market…