Integration of Management between Konica Corporation and Minolta Co., Ltd.
TOKYO, OSAKA (January 7, 2003)
Konica Corporation (Fumio Iwai, president, TSE4902) and Minolta Co.,
Ltd. (Yoshikatsu Ota, president, TSE7753) herein sign "the letter of
intent for the management Integration", as resolved this day by the
Board of Directors of both companies for the basic agreement of an
integration of the management of both companies based on stock swaps
through sprit of equality.
The new corporate group created as a result of this integration of
management takes "The Creation of New Value" as its managerial
philosophy, the concepts of being an "Innovative Corporation That
Continues to Create Impressions in the Field of Imaging" and "A Global
Market Leader That Offers Advanced Technology and Reliability" as its
managerial visions, and "The essentials of imaging" as its corporate slogan.
The greatest goals of this integration of management are to create a
corporate structure that targets the top position in the industry by
greatly strengthening competitive capabilities in our image information
products (0ffice equipment) business, the largest business sector, and
to further solidify our number one market position in the field of
optical products by combining the strong optical technologies of both
companies, and to achieve a one-trillion yen level of sales through the
integration of the management of both companies.
1. Goals of the Integration of Management
In the field of image information products (office equipment), the rapid
advancements being made in digitization and networked environment are
resulting in drastic changes to market needs as well as to the speed of
the development of technologies and products, including those related to
both hardware and software. Global competition in all fields is growing
increasingly severe. In order to survive in today's market, it is vital
to aggressively pursue well-timed, strategic business collaborations
that result in new levels of strength for a corporation.
Konica Corporation positions the field of imaging as its primary
business domain, possesses an extensive range of technologies in the
field of imaging, and is working to expand and develop business in this
area.
Minolta Co., Ltd. also takes the field of imaging as its primary
business domain, and is promoting the development of business areas
focusing on image information products (office equipment) business,
color output devices in particular.
This integration of management will achieve a comprehensive integration
of the strengths of both companies. This integration aims to strengthen
the position of both companies to survive in this era of major global
competition by strengthening the business competitiveness and
profitability, to further increase corporate value, and to ensure a
strong position in the industry.
2. Background of the Integration of Management
Through the business partnership formed between both companies in April
2000 for the field of image information products (office equipment), the
companies have been strengthening their product lineups through
collaborative research and development, and have been achieving a
powerful synergy through efforts such as an increase in profits in the
area of toners and other consumables. This collaboration has also served
to greatly strengthen the mutual trust and reliability between the
companies.
Through these efforts, the companies are working to strengthen their
business competitiveness, to expand business, and increase profits. With
the goal of expanding corporate value, the companies have determined
that the best course of action will be to integrate their management.
With a foundation of strong mutual trust, the top managements of both
companies have reached a strong determination to work toward this
integration in order to survive today's global competition, and after
careful studies of this integration by both companies, management has
decided to sign "the letter of intent for the management integration".
3. The New Corporate Group
This integration of management is based on a spirit of equality between
the two companies. In August 2003, Konica which is to become a holding
company in April 2003 will become the succeeding company, and through
stock swaps with Minolta, an integrated holding company will be newly
formed.
In October 2003, the operations of both companies will be integrated
through business restructuring, forming a new corporate group. (Please
refer to the appendix-1)
The planned new corporate group will consist of the new integrated
holding company, six business companies, and two common function companies.
Financial goals for this integration are for sales of 1.3 trillion yen
and an operating profit of 150 billion yen for fiscal year 2005
(including 50 billion yen resulting from the effects of the integration).
The operating policies for the new group are as follows.
1) By uniting the business strengths of both companies, work toward the
expansion of the business of the new group as a whole, the improvement
of competitiveness, and the increase of profitability.
2) Work to maximize the corporate value of the group through business
portfolio management that encompasses image information products (office
equipment), optical products, cameras, consumer imaging products,
medical and graphic imaging products, imaging and measuring instruments,
etc.
3) Realize fair and open management under a structure of new corporate
governance.
Overviews and strategies of the new integrated holding company, business
companies, and companies serving common functions are given below.
i) Overview of the New Integrated Holdings Company
Company Name: KONICA MINOLTA HOLDINGS, INC.
Location of Headquarters: Tokyo, Japan
Management:
Fumio Iwai, Director, President and Representative Executive Officer
(Currently, President and CEO of Konica Corporation)
Yoshikatsu Ota, Director, Vice President and Representative Executive
Officer (Currently, President and Representative Director of Minolta
Co.,Ltd.)
(*Plans are for Yoshikatsu Ota*, Director, Vice President and
Representative Executive Officer to also serve as the President and
Representative Director of the image information product company, which
will be the largest business company for the group.)
The Board of Directors will consist of an equal number of directors from
Konica and Minolta as well as directors from outside the companies.
Fiscal Year End: March 31 of each year.
Notification of capital and the number of shares to be issued will be
made as soon as these matters have been decided.
ii) Forming the New Integrated Holding Company
Formation of the new integrated holding company will be based on a
spirit of equality between the two companies through the stock swap. As
a result, Konica becomes a holding company serving fully as the parent
company, and Minolta serves fully as a subsidiary. (Please refer to the
appendix-1)
iii) Functions of the New Integrated Holding Company
The goal of the new integrated holding company is to maximize the
corporate value through business portfolio management by governing the
group companies, and providing key functions for the managerial
strategies of the group.
Image Information Products (Office Equipment)
This is the largest business company of the group. By focusing the
strengths of Konica and Minolta, the company improves competitiveness
through strategies within the area that will realize the number one
position in the market.
The principal area of business is placed in the field of input and
output devices in networking for corporate customers focusing on MFPs
(multi functional perpherals) and printers. Emphasis is placed on such
growing fields as color MFPs and printers, and the high-speed digital
copiers. The color output devices and on-demand printing, as well as the
polymerized toner business, will be positioned as strategic fields.
The research and development and direct sales forces will be reorganized
and strengthened with the goal of increasing level of customer
satisfaction. The company will also further refine its strength and
aggressively pursue the strategic alliance.