Sojitz Corporation


Merger of Nichimen Sogo Kenzai Co., Ltd., and Nissho Iwai Building Materials Corp.

Mar. 13, 2000
Nissho Iwai Corp.
Nichimen Corp.

To Whom It May Concern

On March 13, Nichimen and Nissho Iwai Corp. announced that they would merge their building materials subsidiaries w.e.f. July 1, 2000.

1. Purpose of Merger

Both Nissho Iwai Building Materials Corporation (President: Shoichi Tanaka) and Nichimen Sogo Kenzai Co.  Ltd. (President: Yukie Origuchi) have been in operation for almost 20 years each since their establishment. Both possess established operating bases, and the profitability and financial condition of both companies are also in good shape.

On the other hand, the number of housing starts, the core of the building materials industry, has been falling constantly after reaching a peak of 1,640,000 in 1996 (1997: 1,390,000; 1998: 1,200,000; and 1,210,000 in 1999). Industry forecasts predict that demand will stagnate at around the 1,200,000 level for the next few years.

Under such conditions, the merger aims to strengthen the domestic marketing network, gain competitive advantage and become the top company in the industry by capitalizing on the synergy created through the merger, which is expected to increase operational efficiency through a complete reorganization of the logistics function and proactive initiatives in the e-commerce field.
The new company will be the second-largest company in the industry in terms of sales, and will aim for a Stock Exchange listing by 2002.

2. Outline of New Company :

(1) Name:   To be determined soon  

(2) Surviving Company :   Nichimen Sogo Kenzai Co., Ltd.  

(3) Merger date  :   July 1, 2000  

(4) Capital  :   Yen 789 million  

(5) Merger Ratio (Stock Conversion Ratio) :    1   :    1  

(6) Investment Ratio  :   Nissho Iwai   51%, Nichimen   49%  

Nissho Iwai Corp                  :  800,000 shares   (51%)     
Nichimen Corp                       :  768,627 shares   (49%) 
Total stock of the new company:       1,568,627 shares  (100%)   

(7) Representatives

Director/Chairman :
Shoichi Tanaka  (Current President: Nissho Iwai Building Materials Corp.)

President : Yukie Origuchi  (Current President of Nichimen Sogo Kenzai Co. Ltd.)

(8)  Directors  :
10 (Nissho Iwai Building Materials Corp;  Nichimen Sogo Kenzai Co. Ltd: 5)  

(9)  Auditors  :
 3 (Nissho Iwai Building Materials Corp: 2; Nichimen Sogo Kenzai Co. Ltd: 1)  

(10) Business :
Import and domestic sale of plywood, wooden building materials, non-ferrous building materials, construction machinery, etc., as well as construction subcontracts.  

(11) Number of Employees :  
About 300

(12) Offices : 
10  (Sapporo, Sendai, Tokyo, Shizuoka, Nagoya, Niigata, Kanazawa, Osaka, Hiroshima, Fukuoka)  

(13) Annual Sales :
Yen 200 Billion

3. Current status of the two merging parties: 

Nissho Iwai Building Materials Corp Nichimen Sogo Kenzai Co., Ltd. 
Location 3-6 Kioi-cho, Chiyoda-ku, Tokyo 8-8, Toramachi, Nihonbashi, Chuo-ku, Tokyo
Establishment June, 1983  April, 1982  
Capital 400 million yen (Nissho Iwai 100%)   315 million yen (Nichimen 96.6%) 
Sales Yen 114 billion (1999 )
Yen 115.5 billion (Mar.2000 forecast)
Yen 62.8 billion (1999 )
Yen 67.5 billion (Mar.2000 forecast)
Representative Shoichi Tanaka Yukie Origuchi
Employees 197 117

Page top