Nikon's 5 year plan...

Started 11 months ago | Discussions thread
rhlpetrus
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Re: Nikon's 5 year plan...
In reply to roustabout66, 11 months ago

roustabout66 wrote:

bobn2 wrote:

roustabout66 wrote:

bobn2 wrote:

With respect to Nikon, I don't expect Nikon to disappear. For a number of reasons:

i) Nikon is an important part of the Mitsubishi group. I use the word 'group' rather then 'kieretsu' advisedly. Mitsubishi seems to see it as a part, see here:

http://www.mitsubishi.com/php/users/category_result_industry.php?gyousyu_id=0015&lang=1

This puts it is a significantly different position with respect to companies such a Nokia or Kodak. Simply, Nikon won't go bust, and isn't likely to get taken over by an outside concern (they would have to negotiate with Mitsubishi first). Note also what Mitsubishi says Nikon's business is:

http://www.mitsubishi.com/php/users/category_result_info.php?lang=1&click_id=07&company_id=00000004

I agree with much of what you said Bob but my understanding of Japanese "groups" or "Kieretsu"
is somewhat different. My understanding is that they are more of a buying group with members trying to buy from their own group but not having a direct financial relationship and will not rescue a failing company. I could not find a single mention of Nikon in Mitsubishi's corporate annual report or financial annual report.

http://www.mitsubishicorp.com/jp/en/ir/library/ar/

As I said, I used the term 'Group' rather than 'Kieretsu' advisedly. If you look at Nikon's top ten shareholders, we have

The Master Trust Bank of Japan, Ltd. (Mitsubishi controlled)

Meiji Yasuda Life Insurance Company (Mitsubishi controlled)

Tokio Marine & Nichido Fire Insurance Co., Ltd. (Mitsubishi controlled)

The Bank of Tokyo-Mitsubishi UFJ, Ltd. (Mitsubishi controlled)

The Joyo Bank, Ltd. (Mitsubishi controlled)

68% of Nikon is japanese owned, and Mitsubishi banks will control or manage most of that, in one form or another. Moreover, Mitsubishi considers Nikon to be on of its core companies. To the extent which the whole group has a strategy (it does) Nikon is part of that.

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Bob

I did not check out all of your listed companies, only the first, but to call The Master Trust Bank controlled by Mitsubishi seems to be a bit of a stretch since Mitsubishi controls less than 50% of the stock. Also, the idea that companies not owned by Mitsubishi but having Mitsubishi as one of several investors and who have also invested in Nikon would somehow equate to them all coming to the aid of Nikon should they start to falter seems to be wishful thinking.

Nikon is part of the M core group of 28 companies, called the Kinyokai (Friday Club) that meet every month to discuss strategy etc. I think Bob's point is that in Japan things are not like in other countries, each for itself. Check Olympus. Likel;y in the US it'd be closed by now, or just bought by another company and then closed. In Japan they went great lengths no to let that happen (Sony is now giving cards there I think).

For example (from http://en.wikipedia.org/wiki/Mitsubishi_Heavy_Industries)

"In 1970, MHI's automobile parts department became an independent company as Mitsubishi Motors.

MHI participated in a ¥540 billion emergency rescue of Mitsubishi Motors in January 2005, in partnership with Mitsubishi Corporation and Mitsubishi Tokyo Financial Group. As part of the rescue MHI acquired ¥50 billion of Mitsubishi Motors stock, increasing its ownership stake to 15 percent and making the automaker an affiliate again."

It's very very doubtful that Nikon, even if they were losing money, would disappear. At most a restructuring, but I think they will keep doing well, they are actually a very lean company.

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Renato.
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