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MITSUBISHI ELECTRIC AND TOSHIBA
ANNOUNCE INTEGRATION OF POWER TRANSMISSION AND DISTRIBUTION BUSINESSES
TOKYO, March 1, 2002--Mitsubishi Electric
Corporation and Toshiba Corporation today announced that they will
integrate their power transmission and distribution businesses in
a joint venture company that will be incorporated in April this
year and start business on October 1, 2002.
The new joint venture will bring together the sales, engineering,
development and manufacturing functions of the parent companies
for Japan's largest company dedicated to power transmission and
distribution. The scale and business volume of the combined operation
will match those of the world's top three companies in the business
and allow the new company to implement an operating structure that
leads with a global presence.
The announcement by Mitsubishi Electric and Toshiba reflects the
tough realities of the transmission and distribution industry. In
Japan, reduced investment by power utility companies has eroded
the market. Overseas, demand remains stable, but competition is
fierce against industry leaders. Mitsubishi Electric and Toshiba's
first response to these market conditions was an October 2000 comprehensive
agreement aimed at enhancing product development and productivity.
The latest announcement reinforces and extends this collaboration
and is expected to promote the two companies' fundamental competitiveness
in the transmission and distribution business.
| The business integration is expected
to bring multiple benefits. |
| 1. |
Reinforced technology capabilities and lower
costs. |
- Standardization of products and reorganization of manufacturing
allocation to improve cost competitiveness.
- Centralization of development activities to speed product
development.
- Integration of procurement to promote cost savings.
|
| 2. |
Reinforced overseas presence |
- Creation of a global network utilizing the overseas manufacturing
facilities and sales offices.
- Reinforcement of product line-up to expand sales in the
world market.
|
| 3. |
Reinforced operating efficiency |
- Realization of asset-light operation by reduction of overhead.
- Speedy decision-making by a dedicated company.
|
Outline of New Company
|
Company name: |
To be decided. |
|
Start of operations:
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October 1, 2002 (incorporated in April 2002) |
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Capitalization: |
40 to 50 billion yen at initial operation |
|
Shareholding: |
Toshiba 50%, Mitsubishi Electric 50% |
|
President: |
To be decided. |
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Headquarters: |
Tokyo, Japan (planned) |
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Business domains: |
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| Sales, engineering, development, manufacture
and maintenance of high voltage switchgears, power transformers,
Protection systems and computerized power system control,
excluding protection systems in the domestic market. |
|
| Manufacturing facilities: |
1. High Voltage Switchgears: Kawasaki
and Itami
2. Power Transformers: Kawasaki and Ako
3. Protection systems: Fuchu and Kobe
4. Computerized power system control: Fuchu and Kobe
*Kawasaki and Fuchu are Toshiba facilities. Itami,
Ako and Kobe are Mitsubishi Electric facilities. |
|
| Sales Target: 150 billion yen at
fiscal year 2003. |
| Employees: approximately 2,700
at initial operation. (planned) |
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 (FTSE: 6503q.l) 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 construction. The company has operations in 34 countries and
recorded consolidated group sales of over US$33BN in the year ended
March 31, 2001. Additional information on Mitsubishi Electric is
available at global.mitsubishielectric.com.
About Toshiba Corporation
Toshiba Corporation is a leader in information and communications
systems, electronic components, consumer products and power systems.
The company's integration of these wide-ranging capabilities assures
its position as a leading company in all aspects of power generation,
transmission and distribution. Toshiba has 188,000 employees worldwide
and annual sales of over US$47 billion. Visit Toshiba's website
at http://www.toshiba.co.jp/index.htm.
# # #
| Media Contacts |
|
Mitsubishi Electric
Corporation
Matthew Nicholson
03-3218-2346 (Japan)
Matthew.Nicholson@hq.melco.co.jp |
Toshiba Corporation
Kenichi Sugiyama
03-3457-2105 (Japan)
press@toshiba.co.jp |
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