Kenwood, a Japanese audio maker may turn to Cerberus to help fund its bid for Japan’s JVC, a consumer electronics company, also known for its Victor brand.
The move comes after Matsushita Electrical Industrial, JVC’s parent, failed to reach an agreement to sell its 52 percent stake to TPG, according to the UK Newspaper Financial Times, which quoted people familiar with the matter.
JVC and Matsushita have so far indicated that nothing has been decided, refraining from further comment on whether talks with TPG have indeed collapsed according to a number of media reports.
Matsushita, in a statement said it is “studying all kinds of options from the viewpoint of the enhancement of Matsushita’s corporate value, but has not decided anything in regards to the sale of its stake in Victor Company of Japan.”
A handful of senior executives at JVC are believed to have opposed a takeover by TPG because the US buyout firm is seen to be “too hands-on,” said a Tokyo-based source.
According to the FT report, TPG is understood to have pushed for selling JVC’s software and media business and its lossmaking television business, and JVC has rejected these measures.
According to a Tokyo-based investor, JVC is a very difficult company to turn around, and is a “TPG type of target.”
He said JVC was a turnaround target which needed a growth strategy, which he doubted Cerberus could deliver.
He said “It is not a typical buyout situation. Its like trying to catch a falling dagger. They (JVC) are rejecting TPG for being hands-on but that is probably what they need.”