Panasonic maker Matsushita Electric Industrial Co and Sanyo Electric Co denied on Monday a newspaper report that they may form a capital and operations tie-up, the Reuters reported.
The Yomiuri daily reported the two companies had plans to form such a partnership, with the merger of their businesses a possibility in the future.
Matsushita spokesman Akira Kadota denied that the company was considering such move. Sanyo spokesman Hiroshi Tsuchiya also said the report was not true, adding there was no tie-up talks with Matsushita or any other companies.
Sanyo has been restructuring with the help of shareholder Goldman Sachs after its bottom line was hit hard by hefty costs of cutting thousands of jobs, steep price falls and damage from an earthquake to its microchip plant.
The newspaper said Sanyo's shareholders, which also include Sumitomo Mitsui Banking Corp and Daiwa Securities SMBC, have judged the company could recover quicker if it finds a corporate partner.
Matsushita may buy preferred shares in Sanyo from the three financial institutions, with a possibility of integrating the two companies' businesses in the future, the paper added.
The preferred shares that Goldman, Sumitomo, and Daiwa hold are equivalent to 66.97 percent voting rights if they were converted to common stock.
Sanyo has been showing a nascent recovery recently as it focuses its resources on solar cells and rechargeable batteries, its top earners.