Merging Nippon Denchi and Yuasa by share transfer — and cutting capacity by closing Takatsuki (2003)

A holding company built for folding things up

The first thing the new holding company did was close the Takatsuki works and take some 600 voluntary redundancies. In a market where four-wheel demand was flat and prices were falling, the combined domestic share came to roughly 40% in replacement batteries and about 85% in original equipment for motorcycles. That the two sides chose the equal form of a share transfer appears to be because they needed a structure that could proceed to cut capacity without first settling which of them was being absorbed.

The distribution of the pain, however, was not equal. What was closed was the Takatsuki works, descended from the plant Yuasa had built in 1919 in Mishima district, Osaka, while the holding company's head office was placed at Nippon Denchi's address in Minami-ku, Kyoto — and in the 2006 merger it was Nippon Denchi that survived. The capacity bought with two years of extraordinary losses went into entering the HEV and EV markets and into large lithium-ion batteries. That the decision to fold one thing up and the decision to seed the next were taken within the same two years is where the character of this combination shows.