KUALA LUMPUR (June 1): Panasonic Manufacturing Malaysia Bhd has clarified a news report that it will shut down several of its operations in Malaysia this year, which will leave hundreds of its workers jobless.

In a statement, the electrical home appliances manufacturer said it has shut down two product manufacturing departments at the Shah Alam 1 (SA1) plant, while it has no plans to cease operations in Malaysia.

“We completed a rationalisation exercise and business restructuring on March 31. This was in line with the closure of two product manufacturing departments at the Shah Alam 1 (SA1) plant only,” it said.

It reiterated that “no other plants or departments other than the one stated are affected”.

Panasonic said a nominal number of employees within the affected departments were provided with the option of a mutual separation scheme (MSS), and a significant proportion of them voluntarily opted for the opportunity.

For the remaining employees who did not opt for the MSS, Panasonic has offered to transfer them to other relevant departments within the company, in positions that suit their skill sets and potential for growth.

“During this rationalisation exercise, those employees who opted for the MSS have received fair and equitable compensation packages which are above industry norms,” it said.

Panasonic said that the group is constantly looking at how it can best adapt and navigate to maximise business efficiencies and grow the company sustainably amid the complex environment.

“The strategies undertaken are thoroughly thought out and any decisions regarding our workforce are made with the utmost consideration and deliberation,” it said.

Meanwhile, the group clarified that the rationalisation exercise is not related to lawsuits involving its former supplier, executive director Chen Ah Huat and his staff.

“Regarding the query on the lawsuits filed in 2016 and 2017, we would like to inform that the same have been successfully resolved.

“For clarity, the said lawsuits are independent of and unrelated to the recent rationalisation exercise and business restructuring that was completed on March 31,” it noted.

News portal Malaysiakini reported that Panasonic will be closing several of its operations including Panasonic Appliances Refrigeration Devices Malaysia Sdn Bhd in Melaka as the group is said to be facing many challenges.

The challenges include the group having lost two separate lawsuits related to Chen and 15 of his staff members who had defrauded it of "millions of dollars" as payment for work that could not be verified as having been carried out, according to Malaysiakini. It was reported that Chen was fired in 2013, and subsequently, 15 managers were also terminated.

In a separate filing, Panasonic announced that its managing director Kenji Kamada, 58, has resigned from the board, effective May 31.

His resignation was due to the change of representative of Panasonic Holdings Corp of Japan, it said.

As such, the group has appointed Takashi Sugihara, 57, to take over the office, effective June 1.

It said Sugihara has more than 35 years of working experience with Panasonic.

"He joined the corporate planning department of Panasonic in 1988 and has been involved with strategic business planning and has taken up various assignments of planning, sales and marketing in America from 1999 to 2005. He was then assigned as general manager to the procurement department [at the] telecom company Panasonic Communications (Malaysia) Sdn Bhd for the period 2005 to 2008," it added.

At noon break, shares in Panasonic declined eight sen or 0.36% to RM22.10, valuing the group at RM1.34 billion.