Expanding Existing Businesses Through Alliances and M&A

「In the ASEAN countries, the group operates a B2B solutions business supporting companies in promoting carbon neutrality, reducing costs, improving operational efficiency and advancing DX. It acquired 80% of the shares of the company to establish a new business base in Singapore and enter the certification-related solutions business, which has an extensive track record in large-scale construction projects for both independent and private-sector clients. The group operates a total solutions business for corporate customers centered on IT solutions, carbon-neutrality initiatives and BPO. カワハラ事務機 is a community-based company with customers mainly in Iwate Prefecture. The group acquired 100% of its shares to roll out its products and services and make a full-scale entry into the Tohoku region.」

「The overseas solutions business benefited from Malaysian subsidiary Sin Lian Wah Electric Sdn. Bhd. joining the consolidated group, while LED wholesale sales by Sin Lian Wah Lighting Sdn. Bhd. also remained strong. As a result, revenue was ¥1,566 million, up 47.2% year on year, and segment profit was ¥78 million, up 9.8% year on year.」

「As part of its efforts to build strategic partnerships, the company acquired 100% of the shares of SLWE, a Malaysian electrical products and components distributor with nearly 400 customers and an established position as a top distributor for global brands such as Schneider and Honeywell.」

「At a board meeting held on 12 June 2023, the company resolved to acquire all shares of Sin Lian Wah Electric Sdn. Bhd. (head office: Kuala Lumpur, Malaysia).」

「SLW expanded its business by expanding its distributor network and developing DIY stores. As a result, revenue was ¥3,941 million, 2.9 times the year-earlier level. Segment profit was ¥252 million, compared with a loss of ¥66 million in the same period of the previous year, reflecting higher revenue and SLW’s performance, which drove the overall result.」

「Meanwhile, the earnings of SLW Co., which became a consolidated subsidiary during the period, remained strong and boosted segment earnings. As a result, revenue was ¥1,673 million, 2.8 times the level in the same period of the previous year, and segment profit was ¥120 million, compared with a loss of ¥59 million in the same period of the previous year.」

「In addition, the acquisition of 100% of the shares of Sin Lian Wah Lighting Sdn. Bhd. (hereinafter, “SLW”) in October 2021 lifted revenue because the acquired company’s earnings were strong. As a result, revenue was ¥821 million, 3.6 times the year-earlier level, and segment profit was ¥53 million, compared with a loss of ¥12 million in the same period of the previous year.」

「At a shareholders’ meeting held on 30 August 2021, the company resolved to acquire all shares of Sin Lian Wah Lighting Sdn. Bhd. (head office: Kuala Lumpur, Malaysia), and acquired all shares on 8 October 2021.」

「From the third quarter consolidated accounting period, the newly invested Greentech International Pte.Ltd. has been included in the scope of equity-method application.」

「At a board meeting held on 14 May 2021, the company resolved to acquire shares in Greentech International Pte.Ltd., which sells electrical components in Singapore (head office: Singapore; hereinafter, “GT”), and entered into a share transfer agreement. Following the acquisition, GT is scheduled to become an equity-method affiliate. The company intends to acquire 30% of GT to expand its overseas business, a pillar of the group’s growth strategy, given GT’s business relationships with major corporations and local companies in Singapore, including numerous sales achievements in large-scale projects, including public works. The scheduled date is 31 May 2021.」

「As a means of further expanding the IT solutions, energy solutions, BPO and overseas businesses, the company is pursuing business expansion through alliances and M&A with companies offering business synergies.」

「The overseas business had expanded to 9 countries, including ASEAN countries. The company focused on launching sales of new products in each country, actively recruiting local sales employees, and building an organization for sales to local companies.」

「The company acquired shares in FTGroup(THAILAND) Co.,Ltd., FTGroup(ASIA) Co.,Ltd., FTGroup(PHILIPPINES) ,Inc. and PT FT Group Indonesia, located in 3 ASEAN countries (the Kingdom of Thailand, the Republic of the Philippines and the Republic of Indonesia), from FTGroup CO.,LTD., and made the companies consolidated subsidiaries (overseas business).」

「The company concluded that acquiring the overseas local entities of FTGroup CO.,LTD., integrating the overseas businesses of both companies under its leadership, and advancing future business development would contribute to increasing the corporate value of both companies.」

「In the environmental business, the company pursued expansion of LED lighting sales by developing dealers, and in December 2018 acquired 100% of the shares of 株式会社産電, which sells solar power generation systems and storage batteries. The acquisition has contributed to consolidated revenue since the second quarter.」

「In December 2018, the company acquired 100% of the shares of 株式会社産電, which sells solar power generation systems and storage batteries, to expand its business scope.」

「In the information and communications business, the profit margin rose significantly, partly because the 3 companies grouped into the business through M&A during the fiscal year contributed earnings and the earnings of other group companies also improved.」

「Operating profit benefited from the contribution of レカムＩＥパートナー株式会社, 株式会社Ｒ・Ｓ and 株式会社Ｇ・Ｓコミュニケーションズ, whose shares were acquired through M&A in the information and communications business, as well as from business synergies with existing companies.」

「Based on a resolution passed at a board meeting held on 19 March 2018, the company completed payment for the share acquisition on 2 April 2018, acquired 100% of the shares of 株式会社Ｒ・Ｓ (head office: Kita-ku, Osaka; Representative Director and President Takagi Takehiko (髙木 武彦)) and 株式会社Ｇ・Ｓコミュニケーションズ (head office: Amagasaki, Hyogo; Representative Director and President Takagi Takehiko (髙木 武彦)), and made both companies consolidated subsidiaries.」

「The company acquired 51% of the shares of the acquired company to strengthen its domestic environmental business, including sales of LED lighting and air conditioners to corporate customers.」

「As a means of further expanding the information and communications, BPO and overseas businesses, the company is also focusing on alliances and M&A with companies offering business synergies.」