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ACQUISITION: Nidec to acquire Mitsubishi Heavy Industries Machine Tool to support electrification business

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Acquisition, divestment & Spinoff

Mitsubishi Heavy Industries Machine Tool will become the Nidec-Shimpo’s third main business

In a press release dated 5 February, Nidec announced that it will acquire Mitsubishi Heavy Industries Machine Tool. After completion of the acquisition, Mitsubishi Heavy Industries Machine Tool will become the Nidec-Shimpo’s third main business. The company expects to utilize Mitsubishi Heavy Industries Machine Tool’s technology for its future insourcing plan.

Significance: Mitsubishi Heavy Industries Machine Tool designs, manufactures, and sells machine tools, cutting tools, and related products, from Mitsubishi Heavy Industries. Mitsubishi Heavy Industries Machine reported a sales of JPY40.3 billion (USD373.7 million) in the fiscal year ended 31 March 2020. For the year ending 31 March 2021, the company expects a sale of JPY23.1 billion. Nidec said that the acquisition will complement its existing businesses such as manufacturing, sales and services associated with reduction gearboxes and pressing machines through its subsidiary, Nidec Shimpo Corporation.

“The Company is expecting further demand increase for E-Axle, the electric vehicle traction unit that Nidec is most focused on at present. Thus, as the Company aims to expand the sales of this product which combines a motor, an inverter and a reducer, it is imperative for us to strengthen manufacturing capabilities of gears, the core component of the traction unit. In this regard, this latest Stock Acquisition will serve as an important effort to help the Company acquire personnel who are well-versed in the development of gears of Mitsubishi Heavy Industries Machine Tool and these people’s high technological skills in line with the Nidec Group’s strategy for electric vehicle traction unit,” Nidec said in the press release.

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