Panasonic plans to sell three semi-conductor plants in Japan to Israeli chipmaker TowerJazz. It will spin off the domestic plants into a new company by this fiscal year and under a tentative agreement reached recently, sell a majority stake in the new firm to TowerJazz. The factories located in Toyama and Niigata perform mostly front-end steps, such as forming circuits on silicon wafers, for chips going into Panasonic products. They need costly upgrades to stay competitive. Their enterprise value is estimated at US$99 million. Panasonic’s semiconductor business suffered a US$203 million operating loss last fiscal year on sales of US$1.822 billion. The company is moving ahead with plans to halve the business segment’s workforce of roughly 14,000.
The firm has decided to pull out of consumer Smartphones in the Japanese market, and Plasma televisions.