TOKYO, Nov 1, 2018 - (JCN Newswire) - Mitsubishi Corporation (MC) has approved the purchase of an additional stake in TOYO TIRE & RUBBER CO., LTD. (TOYO TIRE) for 50.9 billion yen via subscription to a private placement of shares and has entered into a capital alliance agreement with TOYO TIRE. The purchase of these additional shares will increase MC's shareholding in TOYO TIRE from 3.05% to 20.00%.
The mobility sector is undergoing a once-in-a-century transformation, including the electrification of automobiles and the onset of automated driving technology and, as the so-called CASE trends(*1) advance, major shifts in industrial structures are also becoming more visible. This also has implications for the tire industry, in which the nature of the services demanded and the types of roles executed are changing, not just on the manufacturing side, including the development of fuel-efficient or low environmental impact products that support the shift to electric vehicles (EV) and the improvement of production efficiency utilizing AI and IoT, but on the sales and distribution side as well.
Up until now, TOYO TIRE has utilized its individual technology to build a unique product portfolio, including large-diameter tires for SUVs and other large vehicles.
On the other hand, MC has a wide array of touching points with various industries, and has accumulated know-hows while building a global network through a wide range of businesses.
Through this alliance, MC will expand its cooperative relationship with TOYO TIRE, one that has been in the making over a half-century of transactions and joint venture business overseas, to a companywide partnership. Utilizing its comprehensive capabilities, MC will work closely with TOYO TIRE to create a new business model, one that will contribute to increasing TOYO TIRE's corporate value through the provision of new services that meet the needs of the digital age and that are in line with revolutions in the mobility sector.
Contents of the business alliance
1. Business alliance
(1) Reinforcement of sales capabilities
Establish joint task force for each region (Japan, China, Europe, Middle East and Africa, Asia) to develop marketing channels and progressively strengthen sales, logistics, and operations.
(2) Enhancement of technological capabilities
Promote external cooperation on areas such as "Research on next-generation materials", "Advanced development of manufacturing technology", and "Utilization of AI and IoT technologies" looking ahead on the future mobility society.
(3) Reinforcing Resources
Reinforce TOYO TIRE's human resources capacity by delegating executives to TOYO TIRE from MC with a view to promoting business management at TOYO TIRE and TOYO TIRE group companies and strengthening its management base.
2. Specific use of funds
This capital increase will further strengthen the cooperative relationship between MC and TOYO TIRE and will serve as funding for capital investment aimed at strengthening TOYO TIRE's global business foundation and improving its medium- to long-term corporate value. The specific uses of this fund are as follows.
(*1) CASE: An acronym for the four current automotive trends: Connected, Autonomous, Sharing, and Electricity
About Mitsubishi Corporation
Mitsubishi Corporation, headquartered in Tokyo, is a global integrated business enterprise that develops and operates business across virtually every industry including industrial finance, energy, metals, machinery, chemicals, foods, and environmental business. Mitsubishi Corporation's current activities are expanding far beyond its traditional trading operations as its diverse business ranges from natural resources development to investment in retail business, infrastructure, financial products and manufacturing of industrial goods. For more information on Mitsubishi Corporation, please visit the company's website at https://www.mitsubishicorp.com/jp/en/.
Nov 1, 2018 15:20 HKT/SGT
Source: Mitsubishi Corporation
Mitsubishi Corporation (TSE: 8058)
Topic: Press release summary
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