Will Panasonic, already the world’s largest maker of plasma televisions, become the top electronics company in Japan by revenue?

A successful deal would put it in the top spot.

The heads of Panasonic and Sanyo Electric have agreed in principle to a deal that would see Panasonic take by Sanyo, three society familiar with the matter said Sunday.

Panasonic, previously known as Matsushita Electric Industrial, was in talks with Goldman Sachs and two other major shareholders of its smaller rival, Sanyo Electric, during the weekend to buy a controlling stake, company and financial officials said on Saturday.

Talks with Daiwa Securities SMBC, Sumitomo Mitsui Banking and Goldman are at a preliminary stage and the companies have not entered into price negotiations, the society said on the condition of anonymity considering the negotiations were not public and the public were not authorized to speak about the deal.

The three major shareholders combined hold nearly 430 million Sanyo preferred shares, each of which can be exchanged for 10 common shares. That would value them at about yen621 billion, or $6.31 billion, based on the closing price Friday for the common shares.

Panasonic and Sanyo combined are expected to post yen11.22 trillion in revenue, according to their forecasts for the year ending March 2009, surpassing the projected yen10.9 trillion at Hitachi, the current revenue leader in Japan.

Acquiring Sanyo would put Panasonic in a leading position in the global market for rechargeable batteries, which is expected to grow strongly as the use of portable electronic devices and hybrid or electric vehicles expands.

Masayoshi Okamoto, head of trading at Jujiya Securities, said: “This appears to be the kind of deal where you add one and one and get three, instead of two. Their battery operations would truly be world-class. Some Japanese companies are buying overseas firms to expand their operations abroad. But…

[Source] dhiram