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Hankyu Hanshin Holdings set up via merger of long-time rivals.

OSAKA, Oct. 1 Kyodo

Two companies running trains between Osaka and Kobe merged into Hankyu Hanshin Holdings Inc. on Sunday, creating Japan's third-largest railway operator excluding the nationwide Japan Railway group.

Hankyu Holdings Inc. and Hanshin Electric Railway Co. had been rivals for almost a century. Analysts say the key for the success of their integration depends on how well the new holding firm can blend their different corporate cultures.

About 20 Hankyu Hanshin executives, including President Kazuo Sumi, formerly president of Hankyu Holdings, gathered in Osaka to mark the launch of the company and discuss management strategy.

''It's important to maximize our group's corporate value by respecting both Hanshin's and Hankyu's characteristics and histories, and taking advantage of their brands and originality,'' Representative Director Shinya Sakai, who was Hanshin president, said in a speech.

To commemorate the integration, Hanshin and Hankyu trains will be decorated with marks bearing an image of the two train brands until Oct. 20.

The two former rivals will also promote each other's group companies during a weeklong advertising campaign in their key train stations in Osaka's Umeda district.

Video soliciting membership to the fan club of the Hanshin Tigers professional baseball club will be aired in the Hankyu station. The Hanshin station will air information on upcoming performances by Hankyu's Takarazuka Revue.

Hankyu Hanshin plans to introduce coupon tickets that can be used for both Hankyu's and Hanshin's train services during fiscal 2007 beginning next April.

Hankyu Hanshin was created by Hankyu making Hanshin a wholly owned subsidiary through stock swaps. Excluding the JR group, it is Japan's third-largest railway company in terms of sales after Tokyu Corp. and Kintetsu Corp.

In March, the holding company is set to announce a mid-term management plan through March 2010.
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Publication:Japan Transportation Scan
Date:Oct 2, 2006
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