Panasonic, Sanyo shares soar amid takeover reports

The deal, if realized, would provide much-needed cash for Goldman Sachs Group Inc. of the U.S., which along with Japanese banks Sumitomo Mitsui Banking Corp. and Daiwa Securities SMBC invested 300 billion yen ($3 billion) in Sanyo in 2006.

Adding Sanyo to Panasonic would create Japan's biggest electronics maker, surpassing Hitachi Ltd., and be among the largest in the world.

Sanyo's solar panel business would likely prove an asset for electronics giant Panasonic amid growing interest for green energy. Panasonic, which changed its name from Matsushita Electric Industrial Co. last month, is a leading maker of flat-panel TVs, digital cameras and DVD players.

Sanyo's powerful lithium-ion battery business for autos is another gem for Panasonic, which can hope for a significant global share when combined with its own battery operations, said Tatsuya Mizuno, director at Fitch Ratings in Tokyo.

Sanyo's appliance division, however, could prove a burden for Panasonic because of inefficiency and overlap, he said.

"There's both a plus and minus, but people today were looking only at the plus side," he said.

Sanyo's shares had tumbled by a third the last two months, giving Panasonic an opportunity to exploit the recent plunge in the Tokyo stock market to buy a smaller company.

On Tuesday, demand for Sanyo shares was so great that it was bid-only 195 yen ($1.96) and finished at that price. It had closed Friday at 145 yen ($1.46). Panasonic also shot up, rising 6.8 percent to 1,614 yen ($16).

The Nikkei, Japan's largest business newspaper, and Kyodo News agency reported Saturday the companies were in talks for a deal. Markets were closed Monday for a national holiday, so Tuesday was the first day investors could buy and sell shares.