* Depreciated plants have book value of about $416 mln
* Panasonic in talks to sell 5 overseas plants -sources
* Panasonic's restructuring nears end with sale of plants
* Panasonic shares up 3.5 pct, best close in nearly 3 yrs
By Reiji Murai
TOKYO, Nov 27 Panasonic Corp will sell
its three main chip plants in Japan to Israel's TowerJazz
, people with direct knowledge of the matter said on
Wednesday, as the electronics giant wraps up a
multi-billion-dollar restructuring drive.
The sale is expected to happen before Panasonic closes its
books on the current financial year next March, the sources
said, without giving an anticipated value for the deal.
The three aging plants, which are fully depreciated, had a
combined book value of 42.2 billion yen ($416 million) as of
Panasonic said nothing had been decided. TowerJazz declined
Under President Kazuhiro Tsuga, Panasonic has been paring
back unprofitable operations, including TVs and smartphones,
after it lost a combined $15 billion in the two years to March
this year. Semiconductors are the last major area where the
company is retrenching.
TowerJazz, a foundry that makes chips on a contract basis
for other firms, has a semiconductor plant in western Japan
purchased from a Japan unit of Micron Technology Inc, in
addition to factories in Israel and the United States.
Panasonic aims to give TowerJazz control of three plants and
is also in talks with another unidentified company to sell the
remaining five plants in Indonesia, Malaysia, Singapore, the
Panasonic and TowerJazz are currently negotiating the size
of the stake and the transfer of the factories' 2,500 workers,
the sources added, declining to be named because the information
was not yet public.
Panasonic's chip business has racked up losses reaching 20.5
billion yen in the latest financial year due to a scaling back
of its consumer electronics divisions. The company will continue
to procure chips from the plants after the takeover by
TowerJazz, the sources said.
Panasonic has earmarked 170 billion yen in restructuring
outlays this year as it shifts its focus from consumer goods to
industrial businesses such as automotive electronics, an
increasingly attractive sector for Japan's electronics makers.
Consumer electronics peers Sony Corp and Sharp Corp
have also grappled with losses as they confront fierce
competition from South Korea's Samsung Electronics Co
and LG Electronics.
With the sale of the chip plants, as well as early
retirement offers and transfers to other operations, Panasonic
will halve its semiconductor-segment workforce to around 7,000
by the business year to March 2015, one of the sources said.
Shares in Panasonic rose 3.5 percent to their highest close
in nearly three years on the news, which was first reported in
the Nikkei business daily.