Panasonic cuts profits forecast

Panasonic, the Japanese consumer electronics giant which is trying to take over rival Sanyo, today cut its profits forecast for the year.

The world's biggest maker of plasma-screen TVs cut its forecast for the year to next March from 560 billion yen to 340 billion yen.

Analysts had expected Panasonic to cut its forecasts by at least 30%, but the actual cut of 39% was larger than most of them had predicted.

Electronics firms Sony and Sharp Corp recently downgraded their profit forecasts, hit by a global downturn in consumer demand and the strength of the yen, which has made it harder to export to the West.

Panasonic's first attempts to take over Sanyo were thwarted yesterday, when Goldman Sachs rejected its initial 120-yen-a-share offer as nowhere near enough.

The investment bank and two Japanese banks effectively control 70% of Sanyo's equity.