The pair stated that they hope to increase their share in regional markets where they have lagged to date. Industry observers generally applauded the deal as likely to benefit both companies.
"The increase in the combined market share with Nokia would be a positive in our view," said Nomura Securities analyst Eiichi Katayama in a report on Sanyo issued in response to market rumours before the deal was formally announced today.
A Japanese newspaper reported that Sanyo would hold a majority stake in the venture, but the two companies did not confirm this.
"We still see no prospect of a return to net profits," said Katayama in a research note published at the end of January.
The analyst said today that, although the deal could lead to a doubling in consolidated sales and reduce development costs, Nomura is still uncertain about the earnings impact.
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