“On February 14, agreement was reached whereby 60% of the shares of Healthcare-Tech (capitalized at 40 million), a wholly owned affiliate of Itochu engaged in the supply processing distribution (SPD) business, would be transferred to Air Water. The transfer is set for March 25, with 369 million yen being the price tag for the transfer.

The initials SPD refer to the handling all aspects of the procurement and supply of medical equipment and pharmaceuticals used in hospitals. For the hospitals this means a service which offers a reduction in cost through standardization of procurement and purchase of large amounts at one time. General trading companies, as well as producers of medical equipment and pharmaceuticals, are engaged in this business.

Healthcare -Tech was founded in 1991 as a wholly owned affiliate of Itochu and is a pioneer in this field. The company has over 20 years of experience and accumulated know how in this business. Recent sales totaled 21.587 billion yen (March, 2012). In addition to the SPD business, the company is also engaged in web sales of generic pharmaceutical products to dispensing pharmacies. It has 303 employees (March, 2012). It is a company which boasts of holding second place among trading company related firms in the SPD market valued at about 400 billion yen per annum.

Regarding the current acquisition, Masahiro Toyoda, president of the Air Water Medical Company stated ambitiously, “I’d like to learn a lot from Healthcare-Tech which has an immense amount of experience regarding the medical service business involving SPD and sterilization on a commission basis and polish up our own medical service business even more.” He went on to say, “Regarding the procurement of medical equipment from overseas which is a major topic in our company, I would like to take advantage of wide ranging overseas procurement capability which Itochu has, and bring about new business synergies.”

Of the Air Water medical business valued at about 74 billion yen, SPD accounts for about 11 billion yen. Combining this with that of Heathcare-Tech makes for a total of about 32.5 billion yen. This means that acquiring an 8% share of the SPD market is anticipated.”