“Amada, a producer of metal working machinery and devices, decided at its board meeting held on February 12 that it would implement a take over bid regarding Miyachi, a producer of laser welding equipment, to turn it into a wholly owned subsidiary. The acquisition is due within 26 business days from February 13 to March 21. The offer price per share will be 870 yen while the closing price of the previous business day was 704 yen. The total price to be paid to acquire the entire stock will be around 10.4 billion yen.

Amada has set a goal in their mid-term business plan of achieving sales of 300 billion yen and an operating margin of 15% for the financial year ending in March 2016. The company has expansion of their laser product line as a priority and has been considering expanding their M&A activity. Miyachi generates 20 billion yen in annual sales and has advantages in laser welding equipment and fine welding processing technology. By making it an affiliate, Amada will be able to improve their welding technology used in the final process in sheet metal processing as well as to increase their product line to increase their ability to approach users. In addition, Amada estimated that the acquisition would make it possible for them to expand their sales to users and to those industries with which they have not dealt with very much so far. They will also expand their sales in the automobile and medical equipment industries in Japan and overseas,

Amada estimates the sales will amount to 19.3 billion yen, operating profit 9.2 billion yen, and ordinary profit 10.5 billion yen, and net profit 5 billion yen in the financial results for FY2013 ending in March.”