Hitachi Reportedly in Talks with Bain to Sell Metals Unit for over 800 Billion Yen
April 07, 2021 at 07:40 pm EDT
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Hitachi, Ltd. (TSE:6501) picked a group led by Bain Capital, LP as the preferential bidder for its metals unit Hitachi Metals, Ltd. (TSE:5486) in a deal likely to top JPY 800 billion ($7.3 billion), Nikkei reported. Bain, Japan Industrial Partners, Inc. and Japan Industrial Solutions, Ltd. are considering buying a 53% stake in Hitachi Metals, the financial daily said. Hitachi Metals recently announced it was buying U.S. software company GlobalLogic for $9.6 billion.
But in recent years it has also been divesting domestic hardware assets, including chemical and imaging businesses, aiming to pivot to services instead. A Hitachi representative was not immediately available for comment. The company previously said it was considering ways to bolster its corporate value.
Hitachi specializes in manufacturing and marketing of electronic and industrial equipments. Net sales (including intragroup) break down by family of products and services as follows:
- social infrastructure and industrial systems (24.7%): elevators, escalators, industrial facilities, railway systems, power generation units, etc. The group also provides engineering and construction of nuclear, hydroelectric, and thermal power plants services;
- information and telecommunications products and services (20.1%): systems integration, cloud computing, software, servers, hard disks, PCs, ATMs, data communication base stations, payment terminals, etc.;
- materials and components (16.6%): semi-conductor materials, printed circuit cards, cables, copper and forged steel products, magnetic materials, organic and inorganic chemical products, etc.;
- construction equipment (10%) : hydraulic excavators, wheel loaders, mining equipment, etc.;
- automotive systems (9.4%): powertrain systems, control systems, etc.;
- electronic products (9.2%): fiber-optic components, screen tubes, testing and measurement equipment, medical equipment, equipment for manufacturing semiconductors, etc.;
- household appliances (4.7%): heating and air conditioning equipments, refrigerators, washing machines, etc.;
- other (5.3%): mainly transport, financial and logistical services.
Net sales are distributed geographically as follows: Japan (49.2%), Asia (21.3%), North America (12.7%), Europe (10.8%) and other (6%).