Taiyo Nippon Sanso Corporation (TNSC) and Hitachi, Ltd. recently reached a preliminary agreement on the acquisition by TNSC of Hitachi Oxygen Co., Ltd.,through a lump-sum transfer of shares in the subsidiary.
The companies are expected to sign a share transfer agreement in March, following the completion of the due diligence process by TNSC.
On March 31, 2006 the company will commence operation as a wholly-owned subsidiary of TNSC. Through the development of a supply and distribution network,Hitachi Oxygen enjoys long-term contractual relationships with its customers in Ibaraki. The company possesses superior technology for gas-related applications such as an in-house developed automated bulk-gas supply system for servicing remote areas. In cooperation with other members of the Hitachi Group, Hitachi Oxygen is also actively cultivating gas technologies in cutting-edge fields such as atomic energy, electronics and medical services.
TNSC is working to further strengthen its nationwide supply network(in Hokkaido and Shikoku area), by adding the local industrial gas producers.
TNSC aims to make use of Hitachi Oxygen\\$quot;s proprietary technologies regarding gas supply and gas application.
Hitachi Ltd., meanwhile, is considering various measures for strengthening its group-wide operations and enhancing its competitiveness worldwide under its medium-term management plan, \\$quot;i.e.Hitachi Plan II,\\$quot; which emphasizes further development of its core competence.
Hitachi deemed it to be more beneficial to its long-term business development to allow its industrial gas subsidiary to become a subsidiary of TNSC rather than to maintain the company as its own subsidiary.