Mitsui & Co. and Yamaha Motor Establish New Motorcycle Manufacturing Company in India.
Mitsui's investment will take the form of an allocation of new stock shares to a third party issued by IYM for the equivalent of 30% of the company's capitalization. In this way, IYM will increase its total capital to a planned 5.6 billion rupee (approx. 14.6 billion yen) and utilize the same factory and office facilities used by its predecessor, Yamaha Motor India Private Limited (YMI), to take over YMI's manufacturing and business operations beginning from April. Based on this, YMI will promptly begin the closing of its books and corporate liquidation.
Through the "Yamaha-Mitsui Strategy Committee" that was established following Mitsui's acquisition of 3% of YMC stock (announced May 2007), YMC and Mitsui have reviewed the possibilities for Mitsui's participation in various areas of YMC's business activities with the aim of strengthening its overseas business and cooperative ventures in other areas of business. The decision announced today is a result of these reviews and repeated discussions with a focus on a "comprehensive joint business venture in India."
In 1996, YMC established a joint venture company with local investment to begin the manufacture of motorcycles in India. Since 2001, the company has been operated as the 100% YMC-owned subsidiary YMI. Then in 2005, a separate sales company, Yamaha Motor India Sales Private Limited, was established, after which the Yamaha motorcycle business in India was conducted by two companies specializing in manufacturing and marketing respectively.
With the stable growth of the Indian economy as a whole, the Indian motorcycle market has grown to 7.3 million units in 2007, making it the world's second largest market in terms of demand.
The aims for the future are for YMC to aggressively introduce new high value-added models and promote a sales network strategy that includes expanding the establishments of directly-run showroom/dealerships and for Mitsui to use its strengths in logistics and dealer network development to achieve a synergistic effect that will stimulate a growth in sales of Yamaha motorcycles from 120,000 units (sales amount: 18.2 billion yen) annually in 2007 to 650,000 units (sales amount: 63 billion yen) annually in 2010 and improve the brand's presence in India.
For more informatin, please visit http://www.mitsui.co.jp/en/release/2008/1186720_2849.html
About Mitsui and Co., Ltd.
Mitsui and Co., Ltd. (TSE:8031; NASDAQ:MITSY) is one of the largest trading houses in the world and is active in a wide range of trading activities, along with the development of energy sources and other natural resources for various industries. These include export, import, domestic and offshore transactions in such industrial materials as steel, non-ferrous metals and chemicals as well as in machinery, electronic and industrial products and lifestyle-related products, including foodstuffs, textiles and general merchandise. Mitsui is also involved in various businesses related to the aforementioned activities, as well as telecommunications and IT, service businesses and regional development. For more information, please visit www.mitsui.co.jp .
About Yamaha Motor Co., Ltd.
Yamaha Motor Co., Ltd. is a multinational corporation creating high quality products at 60 factories in 35 countries. About 88% of the company's consolidated net sales are derived from overseas markets. Yamaha Motors has successfully diversified its business by capitalizing on its world-class small-engine, fiberglass-reinforced plastics and electric control technologies. Today, proprietary technologies extend to a wide variety of products, including motorcycles, marine products, power products and surface mounters. For more information, please visit www.yamaha-motor.co.jp .
Source: Mitsui and Co., Ltd.
Mitsui & Co., Ltd. Corporate Communications Division Telephone: +81-3-3285-7596 Facsimile: +81-3-3285-9819
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|Date:||Mar 6, 2008|
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