Panasonic May Look To Sell Its Cell Phone Business

Panasonic Corp. (6752) will consider selling the Japanese cell phone business or forming a partnership with another company, while it will end European operations as early as fiscal 2012, The Nikkei reported.

Panasonic currently sells mobile handsets in Europe and in Japan. Panasonic, lagged behind rivals in releasing smart phones, has already begun restructuring the business by shutting down its domestic factory in Shizuoka Prefecture and moving production to Malaysia. The cost of restructuring the mobile phone business may total JPY 100 billion (USD 1.25 billion).

The company sold 5 million smartphones and generated some JPY 130 billion in sales from the mobile phone business in fiscal 2011. Earlier it targeted tripling the sales volume to 15 million units in fiscal 2015.

As of July, Panasonic projected a net profit of JPY 50 billion (USD 630 million) for the current FY through March, a turnaround from the previous year's net loss of some JPY 770 billion.