JV Agreement
April 22 2003 - 2:00AM
UK Regulatory
RNS Number:2031K
Toshiba Corporation
21 April 2003
April 18, 2003
FOR IMMEDIATE RELEASE
Mitsubishi Electric and Toshiba Announce
Integration of Industrial Electric and Automation Systems Businesses
-New Joint Venture to Enhance Competitiveness
in Japan and the World Market-
TOKYO, April 18, 2003 Mitsubishi Electric Corporation (President and CEO:
Tamotsu Nomakuchi) and Toshiba Corporation (President and CEO: Tadashi Okamura)
today announced that they would establish a new joint venture company
integrating their businesses in industrial electric and automation systems,
including industrial supervisory control systems, drive systems and power
distribution systems. From October 1, 2003, the new company will start business
by offering customers worldwide advanced capabilities in industrial electric and
automation systems, covering industries as diverse as metal processing, pulp and
paper, petrochemicals, automobiles and foods.
The new joint venture will bring together all key functions in the partners'
respective businesses, including development, manufacturing and engineering,
sales, installation and services. It will integrate the assets of the relevant
divisions of each partner, Toshiba GE Automation Systems Corporation, a Toshiba
subsidiary in Japan, and TMA Electric Corporation, an equally owned joint
venture of Mitsubishi Electric and Toshiba for large capacity motors, ands
Toshiba GE Automation Systems Corporation, a Toshiba subsidiary in Japan. The
combined operations of the new company are expected to promote overall
competitiveness and a global presence, and to support an operating structure
that will position the new entity as a leading system integrator in industrial
electric and automation systems.
The global market outlook for industrial electric systems remains severe. In
Japan, manufacturers continue to cut back on capital investment. While overseas
markets are characterized by stable demand they are also witnessing intensified
competition. Mitsubishi Electric and Toshiba decided to integrate their
businesses to enhance competitiveness and promote their presence in the overseas
markets for industrial electric and automation systems.
This integration is expected to benefits to three key areas:
1. Enhanced product competitiveness.
Reorganizing development and manufacturing facilities and promoting product
line integration will achieve this. Centralized product development
activities will lead to faster product development. Review and realignment
of product lines and reorganized manufacturing will improve cost
competitiveness.
2. Reinforced market presence.
A reinforced market presence in both Japan and overseas will follow
complementary customer and market integrations in Japan based on the
partners' strengths. A more global sales network will boost visibility
overseas.
3. Enhanced operating efficiency.
This will be achieved through business integration and a new management
structure will promote speedy decision-making.
* Reinforced market presence, both in Japan and overseas, will follow
complementary integration of customers and markets in Japan, according to
the partners' strengths, while a globalized sales network will boost
overseas visibility.
* Enhanced operating efficiency will be achieved through business
integration, and a new management structure will promote speedy
decision-making.
Outline of New Company
* Company name: TBA
* Start of operations: October 1, 2003
* Capitalization and capital reserve: Approximately 35 billion yen (planned)
* Shareholding: Toshiba 50%, Mitsubishi Electric 50%
* President: TBA
* Headquarters: Tokyo, Japan (planned)
* Business area: 1) Sales, engineering, installation and
servicing of industrial electric
and automation systems for wide range of
industrial manufacturing plants.
2) Development and manufacturing of
power electronic apparatus, large
capacity electric motors and automation
systems for industrial applications.
* Sales Target: Approximately 160 billion yen in fiscal year 2006
* Manufacturing Facilities: 1). Supervisory control systems for manufacturing
plant: Fuchu (part of Toshiba Fuchu Complex);
Kobe and Nagasaki (parts of Mitsubishi
Electric facilities)
2). Power electronics equipment:
Fuchu (part of Toshiba Fuchu Complex);
Kobe and Nagasaki (parts of Mitsubishi
Electric facilities)
3). Large capacity electric motors:
Keihin, Mie, Nagasaki (currently handled
by TMA Electric Corporation)
* Employees: Approximately 2,300 (at initial operation)
About Mitsubishi Electric Corporation
With over 80 years of experience in providing reliable, high-quality products to
both corporate clients and general consumers all over the world, Mitsubishi
Electric Corporation (TSE: 6503) is a recognized world leader in the
manufacture, marketing and sales of electrical and electronic equipment used in
information processing and communications, space development and satellite
communications, consumer electronics, industrial technology, energy,
transportation and building equipment. The company has operations in 35
countries and recorded consolidated group sales of 3,649 billion yen (US$27.4
billion) in the year ended March 31, 2002. For more information about Mitsubishi
Electric visit http://global.mitsubishielectric.com
About Toshiba Corporation
Toshiba Corporation, a world leader in high technology, is a diversified
manufacturer and marketer of advanced electronic and electrical products,
spanning information and communications equipment and systems, internet-based
solutions and services, electronic components and materials, power systems,
industrial and social infrastructure systems, and household appliances. The
company's integration of these wide-ranging capabilities assures its position as
a leading company in all aspects of industrial electric and automation systems.
Toshiba has 176,000 employees worldwide and annual sales of over US$40 billion.
Visit Toshiba's web site at at http://www.toshiba.co.jp/index.htm
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The company news service from the London Stock Exchange
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