OMRON Announces Spin-off of Social Systems Business (Simple Absorption-type Split)
- FOR IMMEDIATE RELEASE
January 28, 2011
Company Name: OMRON Corporation Representative: Hisao Sakuta,
President & CEO
Stock ticker number: 6645 Stock Exchanges: Tokyo and Osaka
Contact: Yoshihito Yamada,
Snr. General Manager,
Corporate Strategic Planning HQ
Kyoto, Japan - Following a resolution at a Board of Directors meeting held today, OMRON Corporation (TOKYO: 6645; ADR: OMRNY) announced that it will transfer the business operations of OMRON's Social Systems Solutions Business to OMRON Corporation's subsidiary company OMRON Social Solutions Co., Ltd. Based on the resolution, an absorption-type split agreement has also been signed today.
As this is a simple absorption-type corporate split in which a wholly-owned subsidiary of OMRON Corporation will take over the business activities of a business division, certain matters and items for disclosure have been omitted from the announcement.
Objectives of Spin-Off
OMRON Corporation has been promoting structural reform across its entire Group. In accordance with its policy of strengthening OMRON's social systems business announced on October 27th 2010, this spin-off of business through a simple corporate split will create an autonomously managed industry-specific company in order to intensify profit structure reform.
- Outline of Split
- 1) Timeline
Resolution to execute spin-off by BOD: January 28, 2011 Signing of corporate split agreement: January 28, 2011 Planned date of split (effective date): April 1, 2011
- 2) Method
- An absorption-type split in which OMRON Corporation is the transferring company and OMRON Social Solutions Co. Ltd. is the assuming company.
- 3) Details about share allocations
- The absorption-type split successor company will issue 98,000 common shares at the time of the spin-off, and will allocate all of these shares to OMRON Corporation.
- 4) Capital reduction due to spin-off
- No capital reduction from this spin-off will occur.
- 5) Handling of new stock acquisition rights and bonds with new stock acquisition rights of the transferring company
- There will no change resulting from this corporate split to the handling of new stock acquisition rights issued by OMRON Corporation. Bonds with new stock acquisition rights are not applicable.
- 6) Rights and duties to be transferred to the assuming company
- The assuming company will assume rights and duties from OMRON Corporation, including assets, liabilities and contractual status required for operating the business to be assumed.
- 7) Outlook on fulfillment of obligations
- No problem is envisaged regarding fulfillment of obligations of OMRON Corporation or the assuming company after the spin-off.
- Overview of Companies Involved in the Spin-Off
(As of March 31, 2010)
(as of December 31, 2010)
1) Name OMRON Corporation
OMRON Social Solutions Co. Ltd.
2) Head office Shiokoji Horikawa Higashi-iru, Shimogyo-ku, Kyoto
Toranomon, Minato-ku, Tokyo
3) Representative Hisao Sakuta, President & CEO
Masaki Arao, President & CEO
4) Business Manufacture and sale of electronic devices
Provision of comprehensive equipment, system, and service solutions for customers' management issues.
5) Capital 64,100 million yen
100 million yen
6) Established May 10, 1933
November 1, 2010
7) Shares outstanding 239,121,372
8) Fiscal year end March 31
9) Principal shareholders and their holdings (%) Japan Trustee Services Bank Ltd. (trust account): 4.35%
The Chase Manhattan Bank 385036: 3.58%
OMRON Corporation: 100%
10) Financial position and operating results Transferring Company (consolidated) Assuming Company Net assets 307,135 million yen (*Note 2) Total assets 532,254 million yen Net assets per share 1,391.41 yen Net sales 524,694 million yen Operating income 13,074 million yen Ordinary income 10,195 million yen
Net Income 3,518 million yen Net income per share 15.98 yen
*Note 1: As OMRON Corporation prepares financial statements according to the U.S.'s generally accepted accounting principles (U.S. GAAP), income before income taxes is presented in the "Ordinary income" section of the above table.
*Note 2: As the assuming company was founded very recently (November 1, 2010), there is no information relating to the company's financial position and operating results to disclose.
- Overview of Business Division to be Spun Off
- 1) Business
- The manufacture, sale, repair, and maintenance of railway-related systems (ticket gates and ticket vending machines), road traffic-related systems (traffic control systems), etc.
- 2) Operating results
- Fiscal 2009 sales (consolidated): 57,981 million yen
- 3) Assets and liabilities to be transferred and their values (planned April 1)
Assets (non-consolidated) Liabilities (non-consolidated) Item Carrying value Item Carrying value Current assets 18,399 million yen Current liabilities 4,766 million yen Fixed assets 10,858 million yen Fixed liabilities 1,320 million yen Total 29,257 million yen Total 6,086 million yen
Note: The above values of assets and liabilities to be transferred are estimates.
- Status of OMRON Corporation and the Assuming Company after Spin-Off
- 1) Status of OMRON Corporation
- There will be no changes to OMRON Corporation's name, head office location, representative, business, capital, reporting period (fiscal year end), or number of shares outstanding, as a result of the spin off.
- 2) Status of assuming company
(planned, April 1, 2011)
1) Name OMRON Social Solutions Co. Ltd. 2) Head office 2-3-13, Konan, Minato-ku, Tokyo 3) Representative Kiichiro Kondo, President & CEO 4) Business Provision of comprehensive equipment, system, and service solutions for customers' management issues. 5) Capital 5,000 million yen 6) Fiscal year end March 31 7) Shares outstanding 100,000
This spin-off will have no major impact on OMRON Corporation's consolidated financial results for fiscal 2010 (ending March 31, 2011).