Merging with Toshiba Mechatronics — and giving up the Shibaura Seisakusho name (1998)

The account kept by the side that surrendered its name

In fiscal 1997 the motor division lost ¥600 million and the semiconductor-related division’s ¥1.6 billion profit covered the hole. On the numbers alone it was obvious what should go — but the business being cut away was the origin of the “Shibaura” in Tokyo Shibaura Electric, and the mainstream of Toshiba’s heavy-electrical lineage. Toshiba, holding 61.6% of the shares, came down on the side of swapping the contents from motors to production equipment. The vice-president, Uchiyama, said plainly that he felt the loss of the name.

That the swap worked, though, is something one can say only knowing the numbers that came later. The company that narrowed to equipment posted losses in the years to March 2002 and March 2003, and the roughly 50% overseas sales ratio proclaimed at the merger stood at 39.5% in the year to March 2006. Even so, sales of $803.4M (¥89bn) in the year to March 2005 were 1.7 times the ¥52.0 billion simple sum of the two companies at the time they combined. A company carved out in 1939 as Toshiba’s ordnance and machinery arm had, fifty-nine years later, stopped being a parts supplier to Toshiba.