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Panasonic sells Tesla stake for $3.6 billion

Stock MarketsJun 25, 2021 11:01AM ET
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© Reuters. FILE PHOTO: A logo of Panasonic Corp is pictured at the Combined Exhibition of Advanced Technologies at the Makuhari Messe in Chiba, Japan, October 2, 2017. REUTERS/Toru Hanai/File Photo

By Sam Nussey and Shinji Kitamura

TOKYO (Reuters) - Panasonic (OTC:PCRFY) Corp sold its stake in electric car maker Tesla (NASDAQ:TSLA) Inc for about 400 billion yen ($3.61 billion) in the year ended March, a spokesperson for the Japanese company said on Friday.

The sale comes as the bicycles-to-hair dryers conglomerate is seeking to reduce its dependence on Tesla and raise cash for growth investment.

Panasonic's battery business is dominated by Elon Musk's Tesla, but the two firms have had a tense relationship at times.

Panasonic bought 1.4 million Tesla shares at $21.15 each in 2010 for about $30 million. That stake was worth $730 million at the end of March 2020. The shares have gained almost seven fold since then and closed up 3.5% at $679.82 apiece on Thursday.

"The impact of crypto assets may have pushed Tesla's share price above its intrinsic value, making it a good time to sell," said Hideki Yasuda, an analyst at Ace Research Institute.

Musk said in February his firm bought bitcoin and would take payment in the cryptocurrency, a decision he later reversed, and his comments on Twitter drive swings in the price of such assets.

While Panasonic gave financial backing to Tesla when it was smaller, the automaker's expansion means there's no need for capital ties, Yasuda added. Panasonic's shares closed up 4.9% on Friday in the biggest such move since January.

The stake sale will not affect the partnership with Tesla, the Panasonic spokesperson said, and was made as part of a review of shareholdings in line with corporate governance guidelines.

The sale comes as the automaker is diversifying its own battery supply chain.

Tesla has struck deals with South Korea's LG Energy Solution, a unit of LG Chem, and China's CATL, with Reuters reporting the latter is planning a plant in Shanghai near the automaker's production base.

Panasonic said earlier this year it would buy the shares https://www.reuters.com/business/panasonic-says-it-will-buy-us-supply-chain-software-firm-blue-yonder-2021-04-23 of U.S. supply-chain software company Blue Yonder that it does not already own, in a $7.1 billion deal. Its biggest such deal in a decade, the price raised the eyebrows of analysts who pointed to the firm's spotty M&A track record.

($1 = 110.8700 yen)

Panasonic sells Tesla stake for $3.6 billion
 

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Comments (7)
Jungwoo Suh
Jungwoo Suh Jun 25, 2021 3:52PM ET
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that sure is a nice chunk of change for panasonic
Gene Kret
Gene Kret Jun 25, 2021 9:44AM ET
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TSLA is crushing Toy in EV market!
Gene Kret
Gene Kret Jun 25, 2021 9:44AM ET
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TSLA is and will continue to crush Toy in the EV market! Sidenote, Cramer gets paid to bad mouth TSLA.
youtube youtube
youtube youtube Jun 25, 2021 6:45AM ET
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Sorry it's working this time you post any bad news , no impact on stock price, try again , harder
Ji Go
Ji Go Jun 25, 2021 6:35AM ET
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This move has Apple’s fingerprints all over it.
Kaveh Sun
Kaveh Sun Jun 25, 2021 2:15AM ET
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A smart move follow by a super dump move. No supply chain software worth more than 1 bil since there r many open sources. They can take 1 and recode it to perfection for a couple hundred mil at most.
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Ad Cline Jun 24, 2021 7:35PM ET
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smart move. the stock will eventually be worth about 65 dollars a share. when tesla spins off space x ....look out below.
Ronan Kelleher
Ronan Kelleher Jun 24, 2021 7:35PM ET
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Hehe its so funny reading comments from people who basically know nothing about stocks. 65 dollars eh? :) so the whole company worth around 1 year revenue and growing at 40% a year. sounds about right. I'm not complaining if it hits $65 I'd probably sell everything I have to buy it.
Mike Brarey
Mike Brarey Jun 24, 2021 7:35PM ET
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so called experts don't even know SpaceX has nothing to do with Tesla's assets, and that current pe is nearly 700
Fabrizio Fusaro
Fabrizio Fusaro Jun 24, 2021 7:35PM ET
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Ronan Kelleher VW worth 140b and its year revenues are 230b. You don’t know what you’re talking about don’t you?
 
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