Dropping “Sumisho” and “Grainger”: the rename and the Mothers listing (2006)

Changing the name is restating whose company it is

What sat at the centre of this decision was less the raising of money than the question of whose name the company would be known by. The $1.4M (¥160m) or so raised in the public offering was small even against the sales of the day, and it is hard to believe the labour of preparing a listing was undertaken for that. What told afterwards was rather that the company threw away a name listing its two shareholders and unified on the name its customers knew, and that it took up the position of a listed company disclosing its own figures itself. For a joint venture to strip off its parents’ names was also a declaration that it would take on the responsibility of explaining its own success or failure.

A change of name, however, does not move the structure of capital. After the listing, Grainger International, Inc. and Sumitomo Corporation still held nearly 70% between them, and the annual securities reports went on stating that judgement over the voting rights lay with the American side. An independent brand combined with capital held by its investors was the kind of arrangement that would have to be settled somewhere. The settlement arrived three years later, prompted from outside by a change in Sumitomo Corporation’s investment policy. The choice made in 2006 gained meaning after the fact, in that it had already put the business in a position to say, when that moment came, that it stood in its own name.