Apollo Funds Announce Strategic Partnership with Panasonic Automotive Systems, a Leading Global Supplier of Advanced In-Vehicle Technologies

Rhea-AI Summary

Apollo Funds to acquire a majority stake in Panasonic Automotive Systems from Panasonic Holdings in a transaction valued at ¥311 billion. Panasonic will retain a minority stake, maintaining a strategic relationship. The deal aims to accelerate growth and leverage Apollo's expertise in the automotive sector.

Financial Analyst

The acquisition of a majority stake in Panasonic Automotive by Apollo Funds is a strategic move that can potentially reshape the competitive landscape of the automotive supply sector. With a transaction value of ¥311 billion, this deal represents a significant investment by Apollo into the advanced automotive solutions market. The retention of a minority stake by Panasonic Holdings Corporation signals a continued strategic relationship, which may provide stability and confidence to existing Panasonic Automotive customers and partners.

From a financial perspective, the transaction could lead to a revaluation of Panasonic's remaining assets, impacting its balance sheet and potentially its stock price. Investors will need to monitor the deployment of the capital received from the sale and whether it will be reinvested into Panasonic’s core businesses or used for shareholder returns. Additionally, the long-term success of the partnership will hinge on the ability of Apollo Funds to leverage its operational expertise to enhance Panasonic Automotive's market positions and drive growth in a highly competitive industry.

Market Research Analyst

Panasonic Automotive's role as a tier one supplier and its strong market positions in integrated cockpit systems and in-vehicle electronics are critical in an industry that is increasingly focused on technological innovation. The automotive electronics market is undergoing rapid transformation with the rise of electric vehicles and autonomous driving technology. Apollo's investment in Panasonic Automotive may accelerate the development of new products and solutions that cater to these emerging trends.

Market analysis suggests that the partnership's emphasis on maintaining strong customer relationships and leveraging Panasonic Automotive’s longstanding reputation for quality and innovation could yield competitive advantages. The collaboration between Panasonic Automotive and Panasonic Group in procurement and fundamental research is expected to enhance the company's ability to innovate and maintain its market leadership, which is essential for sustaining growth in the long term.

Automotive Industry Expert

The automotive industry is currently experiencing a 'once-in-a-century transformational period,' as noted by Masashi Nagayasu, CEO of Panasonic Automotive. The shift towards electrification, connectivity and autonomous driving is redefining the value chain and the types of products and services that are in demand. Apollo Funds' expertise in automotive supply companies could be instrumental in navigating this shift and positioning Panasonic Automotive as a top global player.

The strategic partnership with Apollo may enable Panasonic Automotive to harness additional resources and expertise to innovate and capture new market opportunities. The focus on providing added value to cars and the mobility experience aligns with industry shifts towards more integrated and user-centric automotive solutions. By maintaining a minority stake and strategic relationship, Panasonic ensures that it retains a foothold in this high-growth sector while benefiting from Apollo's operational and sector expertise.

Panasonic Holdings Corporation to Maintain Significant Minority Stake in Panasonic Automotive to Accelerate Growth Alongside Apollo Funds

Transaction Represents Apollo Funds’ Fourth Private Equity Investment in Japan

NEW YORK, March 29, 2024 (GLOBE NEWSWIRE) -- Apollo (NYSE: APO) today announced that funds managed by Apollo affiliates (the “Apollo Funds”) have entered into a definitive agreement to acquire a majority stake in Panasonic Automotive Systems Corporation (“Panasonic Automotive” or the “Company”), a global leader in advanced automotive solutions, including integrated cockpit systems and in-vehicle electronics, from Panasonic Holdings Corporation (TYO: 6752) (“Panasonic”) in a transaction valued at a total enterprise value of ¥311 billion, subject to certain adjustments at closing. Panasonic will retain a minority stake in the Company, which will maintain its strategic relationship with Panasonic Group.

Panasonic Automotive is a tier one global automotive supplier that designs and manufactures advanced infotainment systems and other in-vehicle solutions for leading auto manufacturers. The Company has a longstanding track record of technological and manufacturing innovation and benefits from strong market positions across its core segments with customer relationships spanning multiple decades.

Tetsuji Okamoto, Partner and Head of Japan at Apollo, said, “We are excited to partner with Panasonic Automotive to position the business for accelerated growth. This transaction builds on our proven track record of being a strategic partner to Japan’s leading conglomerates and leverages our strong sector and operational expertise. We have enormous respect for Panasonic Automotive’s reputation for quality and innovation and look forward to working with the Company’s talented team to unlock its full potential.”

Michael Reiss, Partner at Apollo, said, “Apollo has deep experience investing in and supporting the growth of automotive supply companies, and we look forward to helping drive Panasonic Automotive’s next phase of growth. Panasonic Automotive operates at an important intersection of the global automotive supply chain, and we are committed to maintaining the Company’s strong relationships with its customers and partners around the world as a key tier one supplier.”

Yuki Kusumi, Panasonic’s Group CEO, said, “Apollo is a partner that respects the values which have been cherished by Panasonic Automotive towards its customers, employees and business. Through this partnership, Panasonic Automotive could significantly grow as a global leading player. Continuing its role as a member of Panasonic Group, Panasonic Automotive will collaborate with the Group in its procurement and fundamental research to consistently contribute to the evolution of the Mobility Society as an important player.”   

Masashi Nagayasu, Representative Director, CEO of Panasonic Automotive, said, “Panasonic Automotive possesses automotive knowledge and insight, strong customer relationships and great talent. Panasonic Automotive has the potential to win through this once-in-a-century transformational period. By taking advantage of our partnership with Apollo and realizing PAS’ full potential, we aim to become a top global player in the automotive electronics industry by providing added value to cars and the mobility experience with our customers.”

Subject to satisfaction of customary closing conditions including regulatory approvals, the transaction is expected to be completed by the end of the first quarter of 2025.

About Apollo
Apollo is a high-growth, global alternative asset manager. In our asset management business, we seek to provide our clients excess return at every point along the risk-reward spectrum from investment grade to private equity with a focus on three investing strategies: yield, hybrid, and equity. For more than three decades, our investing expertise across our fully integrated platform has served the financial return needs of our clients and provided businesses with innovative capital solutions for growth. Through Athene, our retirement services business, we specialize in helping clients achieve financial security by providing a suite of retirement savings products and acting as a solutions provider to institutions. Our patient, creative, and knowledgeable approach to investing aligns our clients, businesses we invest in, our employees, and the communities we impact, to expand opportunity and achieve positive outcomes. As of December 31, 2023, Apollo had approximately $651 billion of assets under management. To learn more, please visit www.apollo.com and www.apollo.com/japan.

About Panasonic Automotive Systems
Panasonic Automotive Systems Co., Ltd. was established on April 1, 2022. As Tier 1, the company provides advanced technologies such as infotainment systems to automakers around the world, contributing to the creation of comfortable, safe, and secure vehicles. With annual sales of JPY1,297.5 billion, the company operates in 22 countries and regions around the world and has about 30,000 employees. To learn more about Panasonic Automotive Systems, please visit: https://automotive.panasonic.com/

About the Panasonic Group
Founded in 1918, and today a global leader in developing innovative technologies and solutions for wide-ranging applications in the consumer electronics, housing, automotive, industry, communications, and energy sectors worldwide, the Panasonic Group switched to an operating company system on April 1, 2022, with Panasonic Holdings Corporation serving as a holding company and eight companies positioned under its umbrella. The Group reported consolidated net sales of 8,378.9 billion yen for the year ended March 31, 2023. To learn more about the Panasonic Group, please visit: https://holdings.panasonic/global/

Contacts
Noah Gunn
Global Head of Investor Relations
Apollo Global Management, Inc.
(212) 822-0540
IR@apollo.com

Joanna Rose
Global Head of Corporate Communications
Apollo Global Management, Inc.
(212) 822-0491
Communications@apollo.com

 

What is the total enterprise value of the transaction between Apollo Funds and Panasonic Automotive Systems ?

The transaction is valued at a total enterprise value of ¥311 billion.

When is the expected completion date for the transaction between Apollo Funds and Panasonic Automotive Systems ?

The transaction is expected to be completed by the end of the first quarter of 2025.

Who will maintain a minority stake in Panasonic Automotive Systems after the acquisition by Apollo Funds?

Panasonic Holdings will retain a minority stake in the Company.

What are the core segments of Panasonic Automotive Systems 's business?

Panasonic Automotive designs and manufactures advanced infotainment systems and in-vehicle solutions for leading auto manufacturers.

What is the strategic goal behind Apollo Funds' acquisition of a majority stake in Panasonic Automotive Systems ?

The goal is to accelerate growth and leverage Apollo's expertise in the automotive sector.