Taking over Victor’s circuit business — a turn to external growth (2008)

What the acquisition added, and what it could not

$12.6M (¥1bn) is small set against the $759.7M (¥79bn) of consolidated sales the company recorded that year. Even so, for a firm that had grown for thirty-three years by building its own plants and hiring its own people, the meaning of taking another company’s division in whole is hard to measure in money. Of the 147 people who transferred, the R&D group joined joint development the following month, while the production arm was moved to Miyagi in under a year. That a single transaction was handled in two different ways inside the company says much about its character.

What could be bought was technology, customers and people; what could not was the market. When the contract was signed in January 2008, Meiko was thickening its supply capacity on the premise of “sustained expansion in digital consumer electronics,” and the subprime problem appeared only as one concern listed among others. Half a year later it was delaying the start-ups in Vietnam and Wuhan and moving to close the Yokohama plant it had just taken over. Since then the main axis of Meiko’s growth has stayed with building its own factories, and acquisitions — the Vietnamese EMS stake in November 2019, the two embedded-systems subsidiaries in September 2022 — have remained in a supporting position.