Fujitsu Limited November 2, 2017
Fujitsu, Lenovo and DBJ Sign Strategic PC CooperationFujitsu Limited ("Fujitsu") has explored the global strategic PC cooperation with Lenovo Group Limited ("Lenovo") since its announcement on October 27, 2016.
Today, Fujitsu announced the decision to sign agreements with Lenovo and Development Bank of Japan Inc. ("DBJ") regarding a strategic cooperation in the realm of the research, development, design, manufacturing and sales of Client Computing Devices (CCD) for the global PC market.
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Overview of the Strategic PC Cooperation
Fujitsu will sell a 51% stake in its wholly owned subsidiary Fujitsu Client Computing Limited ("FCCL") to Lenovo International Coӧperatief U.A. ("LIC") which is a group company of Lenovo and a 5% stake to DBJ. After the transaction, FCCL will become a joint venture company ("JV") owned by Fujitsu, Lenovo and DBJ and will continue to be known as Fujitsu Client Computing Limited.
The transaction is expected to be closed in the first quarter of FY2018. The aggregate consideration received by Fujitsu will be JPY 28.0 billion that includes JPY 25.5 billion from Lenovo and JPY 2.5 billion from DBJ. After the transaction, Kuniaki Saito, the current Representative Director and President of FCCL, will assume the role of Representative Director and President of the JV.
* The actual consideration could be adjusted from the above-mentioned figures based on FCCL's balance sheet at closing date. The initial consideration from Lenovo will be JPY 17.85 billion and will be adjusted upwards based on FCCL's future business performance.
After the JV is established, FCCL products will continue to be distributed and sold under the Fujitsu brand name. Fujitsu will continue to serve corporate customers worldwide directly or indirectly through its valued channel partner network and provide the related after-sales support and services. FCCL will serve the consumer market in Japan either directly or indirectly through mass retailers and provide product support and services.
Through this strategic collaboration, Fujitsu and Lenovo aim to drive further growth, scale and competitiveness in the PC businesses both in Japan and worldwide. The JV will leverage
Fujitsu's capabilities in global sales, customer support, R&D, highly-automated and efficient manufacturing and systems integration that meet customers' demand. Furthermore, it will benefit from Lenovo's superior operational excellence including world-leading purchasing capability and global business momentum.
Through investment in JV, DBJ will support FCCL's sustainable growth and provide financial expertise from the perspective of a financial institution.
Fujitsu will continue to offer a high-quality, innovative, secure, and reliable Fujitsu branded CCD portfolio to its corporate customers worldwide, contributing to their digital transformation journey, and co-creating the workplace of the future by integrating PC offerings with Technology Solutions
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Overview of the Recipient of the Shares being Transferred
(1) Name
Fujitsu Client Computing Limited
(2) Head Office Location
4-1-1 Kamikodanaka, Nakahara-ku, Kawasaki, Kanagawa, Japan
(3) Representative
Kuniaki Saito, Representative Director and President
(4) Main Business
R&D, designing, manufacturing, sales, planning, maintenance and support of notebook PCs, desktop PCs, etc.
(5) Capital
JPY 400 million
(6) Establishment
February 1, 2016
(7) Major Shareholders and Percentage of Shares Held
Fujitsu Limited 100.00%
(8) Relationship Between the Parties
Capital
Fujitsu owns 100% of FCCL's total issued shares.
Personnel
Directors of FCCL include 2 Corporate Executive Officers of Fujitsu and 2 former Corporate Executive Officers of Fujitsu. One of the Audit & Supervisory Board Member of FCCL is an employee of Fujitsu. Besides, a total of 854 members are loaned from Fujitsu to FCCL.
Business relationship
There is a business relationship in the form of sales and procurement of products and parts of PCs between Fujitsu and FCCL.
There is no other special transaction relationship between the two companies.
(9) Operation Results and Financial Position for the Most Recent Three Fiscal Years (JPY)
Fiscal Year Ended
March 2015
March 2016
March 2017
Net Assets
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20,671 million
29,971 million
(33,861 million)
Total Assets
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57,180 million
78,876 million
(101,783 million)
Net Assets per share
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2,583,875
3,746,375
Revenue
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52,363 million
230,505 million
(344,074 million)
Operating Profit
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7,228 million
12,792 million
(12,943 million)
Ordinary Income
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7,228 million
12,843 million
(13,014 million)
Profit for the Period Attributable to the Owners of the Parent Company
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4,953 million
9,300 million
(9,434 million)
Profit for the Period Per Share
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619,125
1,162,500
Dividends Per Share
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0
0
⋆FCCL has not prepared consolidated financial statements although it has subsidiaries. Therefore, the figures above represent unconsolidated financial results of FCCL and figures in the brackets represent the simple aggregate amount of FCCL's and its subsidiaries' financial results. Further, FCCL has only unconsolidated
financial results for two months in Fiscal Year Ended March 2016 since it was established in February 1, 2016.
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Overview of the Recipient of the Shares being Transferred
(1) Name
Lenovo International Coӧperatief U.A. (LIC)
(2) Head Office Location
De Entrée 250, Unit A, 1101 EE Amsterdam, the Netherlands
(3) Representative
Director: Christophe Philippe Marie Laurent
(4) Main Business
Financial Holding
(5) Capital
€20,000 (JPY 265 million*)
(6) Establishment
September 17, 2014
(7) Major Shareholders and Percentage of Shares Held
Lenovo International Limited 80.00% Shenzhen Lenovo Overseas Holdings Limited 20.00%
(8) Relationship Between the Parties
Capital
There are no noteworthy capital ties between the two companies.
Personnel
There are no noteworthy personnel ties between the two companies.
Business
There are no noteworthy business ties between the two companies.
Status of Related Parties
LIC is not a party related to Fujitsu.
* Calculated based on the exchange rate at 5PM, Nov. 1, 2017 disclosed by Bank of Japan.
(1) Name
The Development Bank of Japan Inc. (DBJ)
(2) Head Office Location
9-6, Otemachi 1-chome, Chiyoda-ku, Tokyo, Japan
(3) Representative
President and CEO: Masanori Yanagi
(4) Main Business
The provision of long-term funding (investment and loans)
(5) Capital
JPY 1,000,424 million
(6) Establishment
October 1, 2008
(7) Consolidated Net Assets
JPY 2,986,284 million
(8) Consolidated Total Assets
JPY 16,570,496 million
(9) Major Shareholders and Percentage of Shares Held
Finance Minister 100.00%
(10) Relationship Between the Parties
Capital
There are no noteworthy capital ties between the two companies.
Personnel
There are no noteworthy personnel ties between the two companies.
Business
Fujitsu borrowed debt loan from DBJ. As of the end of March, 2017, the amount is 30 billion yen, which is disclosed in the business report. There are no other noteworthy business ties between the two companies.
Status of Related Parties
DBJ is not a party related to Fujitsu.
Other Relevant Information
DBJ invests Socionext Inc which is the affiliates for both DBJ and Fujitsu.
(1) Number of Shares before the Share Transfer
8,000 Shares
(Number of Voting Rights: 8,000) (Ratio of Voting Rights: 100.00%)
(2) Number of Shares being Transferred
4,480
(Number of Voting Rights: 4,480)
(3) Transfer Values
Common Shares of FCCL JPY 28.0 billion*
(JPY 25.5 billion from Lenovo, JPY 2.5 billion from DBJ)
(4) Number of Shares after the Share Transfer
3,520 Shares
(Number of Voting Rights: 3,520) (Ratio of Voting Rights: 44.00%)
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Number of Shares being Transferred, Transfer Values and Number of Shares before/after the Share Transfer
* The actual consideration could be adjusted from the above-mentioned figures based on FCCL's balance sheet at closing date. The initial consideration from Lenovo will be JPY 17.85 billion and will be adjusted upwards based on FCCL's future business performance.
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Schedule
(1)Date of Execution
November 2, 2017
(2)Closing Date
FY2018 1Q (scheduled) (The closing date is subject to change depending on circumstances, such as the approval
by competition authorities.)
- Future Impacts
The impact of this share transfer on Fujitsu's consolidated financial results in FY2017 is insignificant. FCCL will be excluded from the scope of Fujitsu's consolidated subsidiaries and become the equity-method affiliates of Fujitsu on the closing date. Due to the exclusion from the consolidated subsidiaries, Fujitsu's sales associated with PC is expected to decrease by 20 percent.
Fujitsu Ltd. published this content on 02 November 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 02 November 2017 07:04:01 UTC.
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