TOKYO (dpa-AFX) - Japanese electronics company Panasonic Corp. (PC) is preparing to provide up to 50 billion yen or $635 million in capital to scandal-hit Olympus Corp. (OCPNY.PK), Kyodo News reported Tuesday. The move will reportedly make Panasonic the largest shareholder in the camera maker.
According to Kyodo, the two companies are in talks for a stake valued between 30 billion yen and 50 billion yen, with Olympus planning to issue shares to Panasonic in a private offering.
Panasonic, which is struggling with losses at its TV business, reportedly plans to make medical devices a core business and wants to form an alliance with Olympus in its mainline operation of medical devices.
Panasonic reported a hefty loss for fiscal 2012 due to deteriorated business conditions hurt by Great East Japan Earthquake, flooding in Thailand, European financial crisis and the historically strong yen.
Media reports had earlier indicated that Olympus was in talks with Panasonic and Sony Corp. (SNE) about a possible capital alliance.
In mid-May, Olympus said it will pay a fine of 191.82 million yen imposed on the company by the Financial Services Agency related to its $1.5 billion accounting scandal. The Financial Services Agency is a Japanese government agency responsible for overseeing banking, securities and exchange, and insurance in order to ensure the stability of the financial system of Japan.
In April, Japanese securities regulators asked prosecutors to seek a fine against Olympus for allegedly falsifying its accounts over five years. The company has admitted to hiding 117.7 billion yen in investment losses dating back to the 1990s and has corrected its financial statements.
PC closed Tuesday's trading at $6.48, up $0.11 or 1.73 percent on a volume of 0.46 million shares.
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© 2012 AFX News
