Panasonic Holdings to Sell its Automotive Business to Apollo Global

On Nov 17, Panasonic Holdings of Japan announced its intention to sell a portion of its automotive systems business to investment funds managed by U.S. entities. Apollo Global Management, a private equity firm, has entered into a memorandum of understanding with a subsidiary of Apollo. Panasonic's shares saw a significant surge in Tokyo trade, gaining 5.3 percent following the news as of 0550 GMT. In the future, Panasonic also mentioned the possibility of listing the business.

Panasonic announced in a press release that the parties will continue to have exclusive discussions with the goal of concluding the agreement details by March 31, 2024. It also emphasized the need for ongoing investment in the automotive systems business to ensure sustained growth for the company, particularly in light of the rapid transition to electric cars and evolving vehicle architecture.

Panasonic provides an extensive range of products and services, such as rechargeable batteries, automotive and avionics systems, industrial systems, and home renovation and construction. Panasonic is listed as a primary stock on the Tokyo Stock Exchange and is included in the Nikkei 225 and TOPIX 100 indices. The Nagoya Stock Exchange also has a secondary listing for it.

In August of 2022, the company, a supplier to Tesla, was in talks to construct a new electric vehicle battery facility in the US, with Oklahoma being considered as a top choice. On top of the planned plant in Kansas, this would be built. Each of them would have an identical capacity. According to SNE research, Panasonic holds the fourth spot globally, with a market share of 10 percent in the first half of 2022. In November 2022, the construction of the battery plant in Kansas commenced.