Panasonic Jumps Most in Six Weeks on Reorganization Plans
May 01, 2011, 9:48 PM EDTBy Kazuyo Sawa
(Updates with comment from analyst in fourth paragraph.)
May 2 (Bloomberg) -- Panasonic Corp., the world’s largest maker of plasma televisions, rose the most in almost six weeks in Tokyo trading after announcing plans to cut jobs and restructure operations to restore profitability.
Panasonic gained as much as 3.3 percent, the biggest intraday gain since March 22, and traded up 2.5 percent at 1,023 yen as of 10:24 a.m. The benchmark Nikkei 225 Stock Average rose 1 percent.
Japan’s biggest maker of home appliances plans to eliminate 17,000 jobs over two years and to stop further investment in both plasma and liquid-crystal display operations to revive profitability at the TV unit, the Osaka-based company said April 28. Panasonic said it will seek overseas alliances to expand in industrial-use solar systems.
“The market reacted to Panasonic’s 17,000 job cuts and restructuring plans,” said Nobuo Kurahashi, an analyst at Mizuho Financial Group Inc. in Tokyo. “Ending investments in TV display operations makes sense. Panasonic made it clear that it will focus on units that will be more profitable in the future, such as solar systems.”
The company delayed issuing an earnings forecast, citing difficulties in making an estimate because of disruptions following the March 11 earthquake in Japan.
--Editors: Terje Langeland, Anand Krishnamoorthy
To contact the reporters on this story: Kazuyo Sawa in Tokyo at ksawa3@bloomberg.net
To contact the editor responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net
