Buying all of Yamagiwa from the state turnaround body for ¥700m (2012)

What it bought was not a market but a name

Read as a diversification betting on a growing LED lighting market, this acquisition misses the point. MARUWA had been making its own LED light sources since 2005 and had gone as far as a production subsidiary in Malaysia, yet sales of lighting equipment had stalled at ¥2.2bn. What was missing was neither the market nor the technology, but a distribution route into the lighting design of buildings and homes — and a name that designers already knew. The $8.8M (¥700m) price can be seen as simply the amount required to take that out of the turnaround body's hands.

That said, as a second pillar it ended half-finished. Lighting fell from 36% of consolidated sales in the year to March 2014 to 14% by the year to March 2026, the Malaysian lighting subsidiary MARUWA had built itself was liquidated, and what remained was the name it had bought. Given that a ¥700m company accumulated ¥3bn of net assets over ten years, one cannot call the judgement wrong. But that is also a story about the core ceramics business growing faster still, until a second pillar was no longer needed.