Panasonic Corp has won $7.6 billion of loan commitments from Sumitomo Mitsui Financial Group and other banks, allowing the Japanese electronics conglomerate to sidestep fund-raising in the credit markets.
Panasonic sought the financing framework to underpin its finances, choosing bank loans because of concern that the eurozone crisis and weaker global economy would make borrowing through bond issues and commercial paper more difficult, a spokesman for the company said.
Sumitomo Mitsui Financial Group has committed to 350 billion yen ($4.44 billion)of the credit, with Mitsubishi UFJ Financial Group promising 200 billion yen ($2.54 billion), the Nikkei business daily reported earlier. Resona Holdings has promised the remaining 50 billion yen ($634.84 million), the report said.
A source with knowledge of the agreement confirmed the banks participation on condition he was not identified.
Panasonic's decision to bolster its finances comes after local TV rival Sharp Corp secured $4.6 billion in emergency loans from banks including Mizuho Financial Group it needed to help repay billions of dollars in short term commercial paper loans.
($1 = 78.7600 Japanese yen)
(Reporting by Reiji Murai; Writing by Tim Kelly)