Apollo Invests in Panasonic Auto Business with Potential for Public Listing

Panasonic Corp. has agreed to sell part of its automotive systems unit, working with an affiliate of Apollo Global Management Inc. and potentially seek a public listing of the business.

The Japanese electronics maker signed a memorandum of understanding with the affiliate and will seek to finalize the deal by March 31, the company said in a statement Friday. Panasonic shares jumped 5.5% in Tokyo, the most since May, leaving them up 35% this year.

The transaction is part of Panasonic Chief Executive Officer Yuki Kusumi’s plan to free up billions of dollars to invest in new areas of growth following the restructuring of the firm into a holding company in April 2022. The Japanese manufacturer, which supplies batteries to Tesla Inc., has for years faced narrowing margins and rising competition from rivals in South Korea and China.

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Panasonic’s new corporate structure has made it easier to forge such deals. The automotive business, called Panasonic Automotive Systems Corp., will become an equity-method affiliate of Panasonic, with funds managed by Apollo taking a majority stake.

The automotive business comprised around 15% of Panasonic’s sales for the latest fiscal year that ended in March, with revenue of ¥1.28 trillion ($8.5bn). The unit mainly focuses on infotainment systems as well as other components that “contribute to the creation of a comfortable, safe and secure vehicle,” according to the statement.

Source: BNN Bloomberg

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