Mitsubishi Corporation
Corporate History & Strategy

In 1947, as part of GHQ's zaibatsu dissolution, the original Mitsubishi Shoji was ordered to dissolve, and the use of the 'Mitsubishi' trade name was temporarily prohibited. The business rights of the original Mitsubishi Shoji were dispersed among multiple companies managed by former employees, and its commercial rights and goodwill were effectively extinguished. Subsequently, the easing of occupation policies following the effectuation of the San Francisco Peace Treaty led the former Mitsubishi Shoji-affiliated companies to begin moves toward reunification in earnest.

In July 1954, four companies—Wako Jitsugyo (which had already changed its trade name to Mitsubishi Shoji in 1952), Fuji Shoji, Tokyo Boeki, and Tozai Koeki—merged to establish Mitsubishi Corporation. Legally, the former Wako Jitsugyo absorbed the other three companies. By the company's own definition, Mitsubishi Corporation's founding year is '1954,' and the fact that it effectively started from scratch following zaibatsu dissolution is a distinguishing feature of its establishment.

Having commenced full-scale operations as a general trading company with the 1954 reunification, Mitsubishi Corporation served as the commercial arm of the Mitsubishi Group while expanding its handling ratio primarily in 'steel, non-ferrous metals, and machinery.' While many major trading companies (such as Itochu and Marubeni) were heavily weighted toward textile trading, Mitsubishi Corporation had a rare product composition centered on non-textile fields. In steel, the company focused on handling exports, establishing the 'Steel Export Department' in December 1960 and building an export structure for steel pipes and cast iron pipes. The primary export destinations were North America and Central/South America.

In non-ferrous metals, the main activities were importing copper ore from overseas and importing aluminum raw materials for Mitsubishi Kasei. Copper ore imports in particular laid the groundwork for equity investments in South American copper mines from the 1970s onward. Regarding machinery, the company's role as the commercial arm within the Mitsubishi Group was prominent, with its primary function being to intermediate in intra-group transactions such as selling Mitsubishi Heavy Industries' plant machinery to Mitsubishi Kasei.

Mitsubishi Corporation's product composition was in part determined by the overall business portfolio of the Mitsubishi Group. The scale of heavy industry and chemicals within the Mitsubishi Group was directly reflected in the handling ratios of Mitsubishi Corporation's machinery and non-ferrous metals divisions. This was less a strategy of Mitsubishi Corporation itself than a reflection of the Mitsubishi zaibatsu's business structure.

While other trading companies that were heavily dependent on textiles later struggled to expand into non-textile fields, Mitsubishi Corporation possessed the structural advantage of having a high non-textile ratio from its very inception. This product composition became the foundation upon which Mitsubishi Corporation expanded into resource and energy business investments from the 1960s onward.

In 1968, Mitsubishi Corporation implemented an organizational reform introducing the product division system to transform its business model from 'trading' to 'business investment.' The traditional trading company function had centered on intermediating between producers and end-users, earning commissions without bearing risk, but President Chujiro Fujino (at the time) proposed the concept of 'Trading and Development,' setting forth the company's entry into business investments including resource development.

The backdrop was a structure in which Japan's trade volume was expanding at twice the world average, and Japan—resource-poor as it was—needed to secure stable resource supplies. The direction of trading companies leveraging their creditworthiness, capital strength, and human resources to engage in overseas resource development was one that would fundamentally change Mitsubishi Corporation's business model.

Mitsubishi Corporation had a head start in LNG handling. Since 1957, the company had developed import plans with Tokyo Gas for LNG and had a track record of importing Alaskan LNG. This knowledge of LNG sales and relationships with major gas and electric power companies became the foundation that later enabled participation in the Brunei LNG development.

In November 1968, Mitsubishi Corporation decided to participate in the joint LNG development in Brunei. The equity stakes in the development company were Shell 45%, Mitsubishi Corporation 45%, and the Brunei government 10%, with Mitsubishi Corporation securing an interest equal to Shell's. Shell took the lead on technical aspects such as extraction, while Mitsubishi Corporation was responsible for selling LNG to the domestic Japanese market—a division of roles.

The total project investment reached $260 million (approximately 93.6 billion yen at the then-exchange rate of 360 yen per dollar), with Mitsubishi Corporation bearing 45% at approximately 42.1 billion yen. The reason Mitsubishi Corporation was able to secure an interest equal to Shell's was that it held sales channels to major domestic gas and electric power companies in Japan. Because Mitsubishi Corporation's domestic network was indispensable for cultivating LNG demand, the company was able to obtain the high 45% interest despite being a trading company without technological capabilities.

The investment in Brunei LNG was Mitsubishi Corporation's first full-fledged step into business investment. It symbolized the shift in business model from merely earning trading commissions to directly investing capital in resource development, acquiring interests, and earning dividend income.

In the 1970s, the oil price spikes from the oil crises improved LNG's price competitiveness. Furthermore, as pollution problems became more serious, the use of LNG as a clean energy source was promoted. Driven by these tailwinds, demand for the LNG provided by Mitsubishi Corporation increased, and the Brunei LNG development project came to generate approximately 20 billion yen in annual dividend income.

In the 1970s, Mitsubishi Corporation held a 77% share (8.25 million tonnes) of LNG handled in Japan. Of this, imports from Alaska accounted for 1.01 million tonnes and imports from Brunei for 5.26 million tonnes, making Brunei the largest source. The Brunei LNG contract ran until 1992, and during this period the project served as a stable revenue source supporting Mitsubishi Corporation's company-wide profits.

The stable dividend income from Brunei LNG also provided the seed capital for Mitsubishi Corporation to pursue other overseas business investments. A cycle was established in which profits from Brunei were reinvested to acquire new resource interests, and Mitsubishi Corporation transformed from a trading-focused company into a business investment-oriented trading company. This structure was carried forward into subsequent investments in Australian coking coal and South American copper mines.

In August 2020, it was disclosed that US investment company Berkshire Hathaway held a 5.04% stake in Mitsubishi Corporation. By the end of the fiscal year ending March 2023, the foreign investor ownership ratio in Mitsubishi Corporation had reached 29.74%, and Berkshire's stake had risen to 6.59%. As overseas institutional investors grew in prominence as shareholders, Mitsubishi Corporation steered toward strengthening its consideration for shareholders.

In 2022, Katsuya Nakanishi became president and formulated the 'Medium-Term Corporate Strategy 2024.' Business portfolio reshuffling was placed at the core of the management policy, and the company sought to improve asset efficiency by selling shares in subsidiaries and affiliates where improvements in corporate value were not expected. President Nakanishi signaled a commitment to practicing the 'Cyclical Growth Model' that had been advocated since his predecessor's era, aiming for growth through business reshuffling.

In 2024, Mitsubishi Corporation announced plans to sell its entire stake in KFC Japan (35.12%) for approximately 40 billion yen to investment fund Carlyle Group. This was one of the concrete cases of business portfolio reshuffling, taking the form of transferring its food service equity to an investment fund.

Simultaneously, Mitsubishi Corporation sold 0.1% of its Lawson shares, reducing its holding from 50.1% to 50.0% to remove Lawson from its consolidated accounts. KDDI had announced a TOB for Lawson, and Mitsubishi Corporation made the judgment to cede management leadership to KDDI. Both the full sale of KFC Japan and the deconsolidation of Lawson were measures intended to improve asset efficiency through portfolio reshuffling, indicating that Mitsubishi Corporation's investment style was shifting from 'long-term holding' to 'reshuffling.'