Three of Japan’s former electronic giants announced a super sale of unneeded office space and other assets.
The sale is a way for the companies to become more efficient and catch up with Samsung and other electronics giants that have taken over the past few years.
The Japan Electronics and Information Technology Industries Association data reveals that Japan’s production of consumer electronics has fallen to around 15 billion U.S. dollars. This is 4 billion less than a decade ago. Japan's main rival is South Korea which has a stranglehold on the smartphone and other consumer electronics market.
As the Christmas season kicks into overdrive, Sony Corporation along with Sharp and Panasonic have been looking to sell off a lot of old buildings and businesses that are draining their profits. For Sony and Sharp the sale could bring in a combined total of about 3 billion in U.S. dollars. Panasonic Corporation, which has been struggling tremendously this past year, claims to own about 10 million square meters of factory and office space that is no longer needed.
In a recent statement to Reuters News Agency, Hideaki Kawai who serves as Panasonic’s chief financial officer stated that Panasonic had a lot of land and buildings in Japan and other properties located overseas that could be sold. Kawai did not state which property would be sold, but it had been estimated that Panasonic could bring in about 1.34 billion (U.S. dollars) from the sale of the properties.
The three Japanese companies, which were once all highly profitable, have recently been downgraded by credit ranking agencies, thereby, hurting their chances of wooing prospective investors. The sale of the unneeded property and other assets was the only logical alternative the companies had. By selling the assets off, the three companies will then be able to lower their fixed costs and eventually improve their operating margins and bring in more cash flow. Panasonic is also considering selling off shares in other corporations they have invested in over the years as well.