Kenwood pulls out of bid to buy JVC

By Sarah Falson

TOKYO: Kenwood is unlikely to bid for Victor Co of Japan Ltd (JVC) regardless of rumours circulating throughout Japanese newspapers that Kenwood will bid for a third of the consumer electronics-maker, according to Reuters.

The bid was cancelled after Kenwood Corp and Matsushita Electric Industrial (parent-company of JVC and Panasonic ) took part in “unsuccessful preliminary talks,” leaving European investment fund, Permira, and private equity firms Texas Pacific Group and CCMP Capital Asia in the running to buy the struggling subsidiary.

Matsushita, which owns the controlling share of JVC at 52.4 per cent, closed applications on bids for the unit on 1 February, meaning the buyout could be finalised as soon as this month.

According to a report by Bloomberg, JVC executives are simultaneously considering a management buyout of the company in co-operation with US investment fund, Cerbeus Group.

Even so, Matsushita claimed that “nothing has been decided”, in a statement to the Tokyo Stock Exchange on the weekend.

The sale would allow Matsushita to scale back its ties with JVC, with whom it allied in 1954 due to financial difficulties in World War II. JVC has posted financial losses in four of the past six quarters due to heightening competition in the consumer electronics industry, says Reuters.

According to a repot from Kenwood in December, the company had planned to buy a third of JVC and turn it into a holding company. 

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