Sanyo Electric Co. Ltd. announced it is in negotiations to sell its cellphone business to fellow Japanese electronics maker Kyocera Wireless Corp. If the deal is completed, it would further consolidate the world’s hotly contested mobile phone business, as well as bolster Kyocera’s market position both in Japan and the United States.
In a press release issued early today, Sanyo said it reached “a basic agreement to continue further negotiations” with Kyocera regarding the sale of its cellphone business, adding that Kyocera now has “priority negotiating rights” for the operation.
The companies did not disclose financial details, including the sale price.
The move comes as little surprise; struggling Sanyo has made no secret that it wants to offload its loss-making cellphone unit. Indeed, the company recently sold its mobile-phone sales and distribution unit to Japanese retailer Telepark Corp. in a deal reportedly worth $85 million. And, according to the Wall Street Journal, Sanyo is in the final stages of auctioning off its semiconductor business.
For Kyocera, the deal would significantly strengthen its mobile-phone business by adding Sanyo’s technological and distribution attributes. Indeed, Sanyo is one of the leading handset suppliers to Sprint Nextel Corp., the No. 3 U.S. carrier. Sprint Nextel is the exclusive provider of Sanyo phones in the United States.
Kyocera, meanwhile, has made a stake in the U.S. handset market with sales through Verizon Wireless, Alltel Corp., U.S. Cellular Corp. and other second-tier players.
Both Kyocera and Sanyo make phones exclusively for CDMA networks.
If the Sanyo-Kyocera deal goes through, the transaction would be the latest in a string of mergers and acquisitions in the cellphone market. Those companies no longer in the game include Alcatel-Lucent, Sendo, Siemens AG, BenQ and others.
Kyocera in talks to pick up Sanyo cellphone biz: Firms mum on purchase price
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