Tateho is a member of the Air Water Group and manufactures and markets magnesium oxide products. It has taken over the magnesia ceramics business of Ozark Technical Ceramics (headquartered in Webb City, Missouri, capitalized at USD10,000). On July 31 Tateho established a wholly owned subsidiary called Tateho Ozark Technical Ceramics. The entire setup of Ozark Technical Chemicals was taken over, composed of 30 employees, production facilities, and an office. The value of the transfer has not been revealed.

With this transfer of business President Minato indicated his intentions when he stated, “The development of our ceramics business had been centered in Japan. With the expansion of this business overseas, especially into Europe, along with acquiring a 50% share of this market, I’d also like to raise the ratio of our overseas business to 60% of total sales.”

Since getting underway in 1982, the ceramics business of Tateho has more or less had a monopoly of the market for intermediate molded products such as those used with industrial heaters and for mineral insulated (MI) cables. The annual business of the company is valued at JPY500 million. Ozark, which handles the same type of products in the US, is engaged in business valued at JPY350 million a year.

Tateho originally had a business relationship with Ozark regarding the supply of materials going back 20 years. There is no overlapping when it comes to sales area or the products sold. The owners of Ozark (Kelly Meares and Greg Lawrence) were facing retirement and had selected Tateho as the company to transfer their business to. Negotiations had been going on for several years.

The global market for magnesia ceramics, which are indispensable for home appliances and equipment for industrial use, is estimated to amount to about 2.5 billion (2014). An annual growth rate of 2% is anticipated. By putting Ozark which has sales centers in Europe under its wing, Tateho will strive to expand its business in the US and Europe, and is aiming at sales of 1.5 billion in 2020. As mentioned above, this is equivalent to a 50% share of this market.

The new company is fully capitalized by Tateho. The Tateho core business is magnetic steel sheets and heaters, and sales in its consolidated statement for 2014 amounted to about JPY9.3 billion. The amount of sales targeted for this company in the Air Water Group, which has come up with sales of JPY1 trillion for 2020, comes to JPY20 billion. President Minato said, “As we head toward target of the group, we’re quietly moving ahead with an expansion of our business, not only this ceramics business but also of other business, including M&A activity.”