News comes from The Gas Review (TGR) that a new player is now in operation in the Japanese gas and welding sector, in the shape of Taiyo Nippon Sanso Gas & Welding.

The new entity, which officially began operations on 1st April, is to be the core company for the distribution of gas and welding materials within the Taiyo Nippon Sanso (TNSC) group.

It is also thought that this is the first move within the group toward its downstream reorganisation.

Taiyo Nippon Sanso Gas & Welding has arisen out of the merging of three group companies; Saan-Tech, Futaba Bussan, and Toei Kagaku. It is understood that in a contracting gas and welding materials market in Japan, TNSC felt the need to merge the three group companies and create one stronger operation in this business.

Masanori Zaiman, who was appointed as President of Saan-Tech in December last year, alluded to this objective when taking the reins six months ago, “Contraction of the demand for gas, as well as welding and cutting materials due to the Japanese manufacturing industry and the drop in new orders in the shipbuilding industry, are an ongoing phenomenon.”

“Merging of companies within the group is therefore moving right along, as we aim for expansion of operations through expansion of scale.”

The new company, a wholly-owned subsidiary of TNSC, is believed to have strong financial targets ahead. According to TGR, the sales target for Taiyo Nippon Sanso Gas & Welding in its first year is Y22.4bn – indicating that this has become a core company for TNSC cylinders, welding materials and welding equipment. Sales of Y40bn are targeted by year three, with an operating profit ratio of more than 3%.

With the domestic demand for gas and welding materials continuing to shrink, the newly formed company will need to make use of its strengths to survive. It is thought that it will therefore make full use of the procurement capacity within the TNSC group, perhaps with some procurement from recently acquired Singapore gas distributor, Leeden.