Splitting Nomura Securities’ property arm in two (1970)

Which company do you get your work from

At the centre of this decision, one may read, was a distinction: which company do you get your work from. Looking after the parent’s buildings means a certain source of orders and income that is easy to forecast, but it also means a ceiling on growth tied to the parent’s branch network. Land development and housing sales mean finding and buying the land yourself and carrying the judgment of whether it will sell. Rather than leave two businesses of such different character inside one company, the choice to set up a firm devoted to the latter had the meaning of shifting the company’s centre of gravity to the side that competes in the open market.

The separation, however, was not a severing of ties. The new company kept the Nomura name and remained inside the Nomura Securities group in ownership terms as well. The two-company structure lasted until the move to a holding company in 2004, when the capital framework was rearranged for the first time. How far to build development capability of your own while still holding a dependable source of orders — the line drawn in 1970 anticipated a question the company would face again and again, right through to its listing and its acquisitions.