(Reuters) - Panasonic Corp <6752.T> will slash a significant portion of its mobile phone business as it struggles to make headway in the global smartphone market, dominated by Apple Inc
Panasonic, which sells mobile handsets in Europe and Japan, has been facing sluggish sales in Europe. It will close its mobile phone operations in the region as early as fiscal 2012, the Japanese business daily reported.
Domestic cell phone sales are also struggling because the firm lagged behind rivals in releasing smart phones, the daily said.
Panasonic will consider selling the Japanese cellphone business or forming a partnership with another company, it added.
The company has already begun restructuring its business by shutting down its domestic cell phone factory in Shizuoka Prefecture and moving production to Malaysia, the Nikkei said.
The company sold 5 million smart phones and generated some 130 billion yen ($1.62 billion) in sales from the mobile phone business in fiscal 2011.
The total cost of restructuring the business segment may total 100 billion yen, the Nikkei said.
As of July, Panasonic projected a net profit of 50 billion yen for the current year through March, a turnaround from the previous year's net loss of some 770 billion yen, it added. ($1 = 80.1650 Japanese yen)
(Reporting by Aditi Shrivastava in Bangalore; Editing by Anil D'Silva)