April 27, 2009
The Furukawa Electric Co., Ltd. (the “Company”) will restructure and consolidate the magnet wire operations of the Furukawa Electric Group.
The Company will consolidate its own magnet wire operations with those of Totoku Electric Co., Ltd. (“Totoku”) and Riken Electric Wire Company Limited (“Riken”) under Furukawa Magnet Wire Co., Ltd. (“Furukawa Magnet Wire”), a wholly owned subsidiary established by the Company on April 22, 2009. Under the new arrangement, the Company will market magnet wires on behalf of Furukawa Magnet Wire.
Scheduled to launch production on April 1, 2010, Furukawa Magnet Wire estimates that sales in the initial year will total 24,000 million yen.
Furukawa Magnet Wire expects synergy from the consolidation of the three companies' operations and aims to generate customer value as a comprehensive magnet wire manufacturer equipped with world-leading technology.
Background and objectives
Domestic demand for magnet wires had remained relatively firm until the first half of the previous fiscal year. However, capital investment and personal consumption plunged in step with the global recession that originated in the United States in the second half of the previous fiscal year. In response to the decline, customers downsized their production, prompting a sharp fall in domestic demand for magnet wires. Meanwhile, a number of products achieved performance improvements in response to growing customer demands for less expensive magnet wires that offer higher quality.
In this environment, the Furukawa Electric Group seeks to develop the ability to make comprehensive proposals based on a full lineup ranging from thick wires to extremely fine and special wires. It also seeks to provide services of consistent quality, and to generate customer value with world-leading technology by consolidating the magnet wire operations undertaken by Group companies.
Steps toward consolidation and restructuring
The Company established Furukawa Magnet Wire as a wholly owned subsidiary on April 22, 2009.
Totoku will transfer its magnet wire operations to Furukawa Magnet Wire and will start relocating facilities to the new company on October 1, 2009.
Then, on April 1, 2010, the Company and Riken will terminate their respective magnet wire related operations and stainless steel wire operations and integrate them with Furukawa Magnet Wire.
Furukawa Magnet Wire is scheduled to commence production on April 1, 2010. The Company will start marketing magnet wires on behalf of Furukawa Magnet Wire on April 1, 2010 under the new arrangement.
Overview of the consolidated company (plan for April 1, 2010)
| Business name | : Furukawa Magnet Wire Co., Ltd. |
| President | : Fumikazu Sano |
| Head Office | : 1-12-22 Tsukiji, Chuo-ku, Tokyo |
| Paid-in capital | : 95 million yen |
Image of consolidation for magnet wire operations
