TOKYO, April 26 Japanese electronics maker NEC
said on Friday it has secured $1.3 billion in
subordinated loans from a group of lenders including Sumitomo
Mitsui Banking Corp and Development Bank of Japan as it
sheds loss-making operations amid turnaround efforts.
The funding will strengthen its balance sheet since half of
subordinated loans is accounted toward capital by a ratings
agency, the company said in a statement. It said it would use
the fund raised to pay back debts and finance business
The company reported a net profit of 30.4 billion yen for
the year ended in March, a sharp swing from 110.3 billion loss a
The company, which makes PCs, mobile phone handsets and
servers, has been undergoing major restructuring of its business
portfolio as it bets its future on IT services.
The company is in talks to sell its struggling mobile phone
unit to its personal computer venture partner Lenovo Group Ltd
, a source has told Reuters.
The company's mobile phone handsets and other consumer
products lag far behind in scale to compete against global
leaders like Samsung Electronics and Apple.
NEC said it only sold 2.9 million mobile phones for the year
ended in March, falling short of its target of 4.3 million
SMBC, a core unit of Sumitomo Mitsui Financial Group and
NEC's main lender, and four other banks will together provide
130 billion yen ($1.3 billion) in subordinated loans.