Panasonic on it's last leg

Ade

Perhaps you did not realize that the excerpt you quoted above is about the formation of Panasonic Semiconductor Solutions (PSCS) which has nothing to do with the 51% joint venture with TowerJazz.

PSCS remains wholly owned by Panasonic. From Page 3 of what you call the "full description":

"(iii) Allotment of Shares -- As PSCS is a wholly-owned subsidiary of Panasonic which will be newly incorporated by Panasonic, PSCS will not provide any consideration upon the Company Split."

http://panasonic.co.jp/corp/news/official.data/data.dir/2014/02/en140204-4/en140204-4.pdf

PSCS is not being "sold off" or "divested" in any way to TowerJazz or to any other party.

Golf007sd

Divesting = selling off. If you Divest your interests, you are reducing your ownership, which is selling it off. It is just a softer way of saying "we want out" or, "we owe X company so much that we have traded debt for giving them interest in in a division/company." Companies do this all the time. When a company sells 51% of a division, it has to be spun off in it's own company- that is inherently understood. You can't retain "ownership" if you own less than 50% - a new company must be created.

As an investor, as well as, an individual that fully understands the language a.k.a the "mumbo jumbo" of what Panasonic is doing...TTJ has is nailed down. They are saying "we want out."

On the other hand, when a company buys back its own stock...they "the company" a.k.a senior management, is telling the world that "our stock is undervalued" because we have information that you...a.k.a the public do not know/have. So they will buy their own shares and see it rise up when they...a.k.a the company, decided to share its info with the public at large...we the investors. At this point in time, the positive news cause the stock to rise and the company...a.k.a the senior management reps in the rewards via their own personal stock option plans. The company itself benefits because it can not leverage itself in issuing bonds (if they offer it) as well as the ability to secure loans and credit lines.

Now as for Panasonic, I personally do not believe "the company" as a whole is going anywhere.

Ade

Oh by the way, even the original article in 43rumors was updated to read:

"Panasonic sells 51% of three imaging sensor facilities"

I think it's clear that Panasonic never sold or divested 51% of it's "Imaging Division".

http://www.43rumors.com/panasonic-sells-51-of-its-imaging-sensor-business/

Ade

@Golf007sd

That Panasonic divested 51% of something was never disputed. But what they sold was 51% of three semiconductor wafer plants that they owned. (At the time, they owned 13 others).

That is very different from a claim that Panasonic sold "51% of their Imaging Division".

Golf007sd

@Ade

This is very much like what SBC Communication did when it purchased AT&T as a whole. If you recall, back then SBC separated AT&T's from it's wireless division. In short, they sold it off by creating a new company.

In fact, both companies are now better off...who is to say the same thing will not happened to Panasonic. Hence, Panasonic will become a better corporation as a whole and attract investors and prosper.

Ade

Golf, do you understand the difference between Panasonic's "Imaging Division" vs. Panasonic's Semiconductor Business Division? They are two completely different divisions.

1. Within Panasonic, the division which produces cameras, camcorders, etc., is part of a corporate segment called AVC Networks Company.

More specifically, the AVC Networks Company has four core business: the Digital AV Business, Imaging Business (including cameras and camcorders), System Networks Business, and Mobile Communications Business.

2. Panasonic has another, completely separate corporate segment, called the Automotive & Industrial Systems Company (AIS).

Part of AIS is a Semiconductor Business Division (Semiconductor BD), which until late last year operated 16 semiconductor plants around the world.

What Panasonic did was to divest some interest in 3 out of 16 semiconductor plants, in their Semiconductor Business Division, part of the Automotive & Industrial Systems Company.

Panasonic DID NOT sell or divest 51% of their "Imaging Division". As mentioned above, Panasonic's imaging business is part of a completely separate corporate segment, the AVC Networks Company.

Golf007sd

Thanks for the clarification, i knew to some extent their over all operation, but not to that detail.

Now, do we know what was being produced in those 3 plants and it related to and impacts their imaging division...ie. TV's, cameras, and there other digital products over all?

Ade

Sure, this is what I wrote before (what's being produced is underlined):

"What Panasonic actually did was to spin-off a fraction of its semiconductor division, part of its Automotive & Industrial Systems business, to a new joint-venture that is 51% owned by Tower Semiconductor, 49% owned by Panasonic. Under the deal, the new JV will gain three of Panasonic's plants which produce various devices including image sensors, intelligent power devices and LSI processors."

As for impact to the Imaging Division, basically none. Those three plants will continue to make the same chips for Panasonic as before.

Panasonic has been struggling to run these plants at full capacity. It doesn't make sense for them to continue funding "in house" fabs for these types of devices. They were probably losing money operating these three plants.

With the joint-venture agreement, TowerJazz now will make the chips for Panasonic under contract, at least for the next five years. Panasonic no longer needs to worry about funding the fabs. And, TowerJazz can use the "excess capacity" of the plants to make other chips for other clients. So on paper it's a "win-win" for both companies.

TaoTeJared

And Ade ruins yet another thread because of his vindictive assaults on me and then was proved wrong. This continual crap of you trying to save face ends up miss informing and becomes confusing to those who don't care if you are proved wrong. It's a disservice to everyone and embarrassing to you.

Ade you are 100% off on your understanding what the terms they are using mean in the context and practice in business use. And what is not unusual as well, is that you are cherry picking and changing the meaning of excerpts to try to save face. The required press releases are worded in a particular way to meet standard accounting practices (IFRS). The language used, has specific definitions. These are not marketing documents, they are accounting documents that carry legal ramifications if "played" with. They are formal communications to shareholders. If something was called their "semiconductor business" once, it must always be called that, even if the dictionary definition of semiconductor is no longer valid. It makes no since, it's dumb, weird - yes, but that is how it is done.

You are parsing words trying to save face and ignoring reality. They have moved the factories that support their Imaging division (that also make some things for other divisions - there is nothing that says they can't do that either) of their company to a new company, and sold 51% of it off. 3 of 16 plants? That is just naive - those numbers mean zilch! Three plants could easily equal over half of their production - hell they could equal 90%. I worked with a company that have 12 fabrication facilities around the world, but the main location created 80% of their produced goods. 51% of it was sold - Three plants have new ownership - if that don't make math simple, I don't know what would.

Panasonic is preparing to off load anything it can.

eliminated 32,000 jobs as of September from a year earlier. Tsuga, who took control in June 2012, said he plans to eliminate unprofitable divisions by March 2016.

The company plans to double revenue to 2 trillion yen by March 2019 from automobile-related products such as drive-control systems as part of Tsuga’s plan to cut reliance on consumer electronics. Panasonic is also looking to expand in housing-related products.

That does not equal good news for their Camera systems aka:Lumix brand at all. Hopefully someone will be interested in buying it.

Golf007sd

What needs to be said about this topic has been said. Thank you all for your input.

Topic Closed.