May 9, 2011
Furukawa Industrial S.A. Produtos Electricos (head office: Curitiba, Paraná, Brazil; hereinafter “FISA”), a wholly owned subsidiary of our Company, has reached an agreement with local shareholders as of March 31 to acquire Metrocable, a local company that manufactures and sells optical fiber cables. In addition, an application has been made to the examination organization of Brazil relating to the anti-monopoly act (SBDC) to obtain approval for the acquisition.
In the optical fiber cable markets of the Latin American region, where rapid economic growth is expected to continue, further business expansion is being attempted by enhancing production capabilities and productivity.
Background to acquisition
Established in 1974, FISA in Brazil manufactures and sells optical fiber cables and LAN-related products, mainly in Latin America. It is the main company in this area in Brazil, boasting a share of over 50%, particularly in terms of business-use LAN cables with a data rate of 1 gigabit per second.
Brazil will host the Soccer World Cup in 2014 and the Olympic Games in 2016, and significant growth in demand for optical fiber cables is foreseen for the development of telecommunication infrastructures.
Purposes of acquisition
By acquiring Metrocable, which excels in the areas of FTTH/FTTP(*) subscriber optical fiber cables, the following synergistic effects are to be achieved to enhance our competence in the optical fiber cable markets of Latin America, where rapid economic growth is expected to continue.
- Enhancing production capabilities and optimizing production bases in Latin America
- Enhancing quality and cost competitiveness by supplying fibers made by our Group companies
- Enhancing productivity by providing production know-how
2.Outline of acquisition
(1) Name of company acquired
|Metrocable Industria e Comércio Ltda(Metrocable)|
|(2) Location||Salto, São Paulo, Brazil|
|(4) Scope of business||Manufacture and sale of FTTH/FTTP(*) subscriber optical fiber cables
(self-supporting aerial optical cables, office cables, optical codes, etc.)
|(5) Investment ratio||Wholly owned by FISA|
(*)FTTP : This term is an abbreviation of Fiber To The Premises. “Premises” refers to land lots, houses, establishments, and facilities, and FTTP signifies telecommunication services via optical fiber cables that reach subscribers.
Compared to the term Fiber To The Home (FTTH) that is generally used in Japan, FTTP is a generic term meaning optical fiber services, including those to company buildings.