Innovation & Corporate Development Segment - Mitsui & Corporate Development Segment Business...
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Innovation & Corporate Development Segment Business Portfolio ICT business, featuring added value unique to Mitsui • High-speed Internet infrastructure business in emerging economies • Operation of service platforms and service business, including marketing • Broadcasting services and TV shopping business • IoT • SI, cyber security, and cloud service business Expanding into new areas by utilizing financial and logistics expertise to evolve our business • Asset management, leasing and insurance • Buyout investment and venture investment • Commodity derivatives and provision to clients and group companies with hedging tools for price fluctuation risks of commodities • Logistics center business including warehousing and delivery centers and the establishment and proposal of logistics strate- gies for clients Risks and Opportunities Emerging economies expecting high growth and new business Emerging economies are showing high growth potential in the ICT business field, particularly in communications infrastructure, where expanded investment is expected, as well as in the service business industry, which has also seen a shift in investment. In addition, such things as high-speed Internet infrastructure and TV shopping, both widespread in developed countries, are grow- ing in emerging economies. Creating business by capturing ICT innovation and a change in business model The rapid deployment of smartphones and tablets and the evo- lution of ICT infrastructure, such as cloud computing, are driving the creation of a variety of new businesses that utilize IoT (Internet of Things) and Big Data. Business environments are changing rapidly, and as a result, there is a need to take swift action as technological innovation, as well as new services and business models, leads the way toward a next-generation society in which advanced ICT services and the real economy are closely linked, as demonstrated by the optimal control of infrastructure. Expansion of global asset management business Given the recent trend in which countries around the world are implementing monetary easing initiatives and enhancing their legal frameworks, Mitsui is expanding its real estate asset man- agement business, combining the knowledge of the real estate and finance businesses, in both developed and emerging econo- mies around the world. Supporting corporate growth through the provi- sion of management know-how and risk capital Buyout funds and other private equity funds, which provide management know-how and funding, are playing an increas- ingly important role in supporting corporate growth. Moreover, from the viewpoint of institutional investors looking to diversify investment risk and investment targets, private equity funds are expected to continue to be an attractive asset class. Continued diversification of global logistics needs due to growth in consumer markets in emerging economies While logistics to and from Japan are declining, intraregional logistics and logistics infrastructure are expected to expand among emerging countries as their economies and consumer markets grow. Furthermore, due to the diversification of con- sumer needs, there is a need for value-added logistics services. IT & Communication Business Unit Corporate Development Business Unit Executive Managing Officer, Chief Operating Officer of IT & Communication Business Unit Nobuaki Kitamori Executive Managing Officer, Chief Operating Officer of Corporate Development Business Unit Yasuyuki Fujitani Business Overview MITSUI & CO., LTD. ANNUAL REPORT 2016 60
Transcript of Innovation & Corporate Development Segment - Mitsui & Corporate Development Segment Business...
Innovation & Corporate Development Segment
Business Portfolio
ICT business, featuring added value
unique to Mitsui•High-speedInternetinfrastructurebusinessin
emergingeconomies
•Operationofserviceplatformsandservicebusiness,
includingmarketing
•BroadcastingservicesandTVshoppingbusiness
•IoT
•SI,cybersecurity,andcloudservicebusiness
Expanding into new areas by utilizing fi nancial
and logistics expertise to evolve our business•Assetmanagement,leasingandinsurance
•Buyoutinvestmentandventureinvestment
•Commodityderivativesandprovisiontoclientsand
groupcompanieswithhedgingtoolsforpricefluctuationrisks
ofcommodities
•Logisticscenterbusinessincludingwarehousinganddelivery
centersandtheestablishmentandproposaloflogisticsstrate-
giesforclients
Risks and Opportunities
Emerging economies expecting
high growth and new business
Emergingeconomiesareshowinghighgrowthpotentialinthe
ICTbusinessfield,particularlyincommunicationsinfrastructure,
whereexpandedinvestmentisexpected,aswellasintheservice
businessindustry,whichhasalsoseenashiftininvestment.In
addition,suchthingsashigh-speedInternetinfrastructureand
TVshopping,bothwidespreadindevelopedcountries,aregrow-
inginemergingeconomies.
Creating business by capturing ICT innovation
and a change in business model
Therapiddeploymentofsmartphonesandtabletsandtheevo-
lutionofICTinfrastructure,suchascloudcomputing,aredriving
thecreationofavarietyofnewbusinessesthatutilizeIoT
(InternetofThings)andBigData.Businessenvironmentsare
changingrapidly,andasaresult,thereisaneedtotakeswift
actionastechnologicalinnovation,aswellasnewservicesand
businessmodels,leadsthewaytowardanext-generationsociety
inwhichadvancedICTservicesandtherealeconomyareclosely
linked,asdemonstratedbytheoptimalcontrolofinfrastructure.
Expansion of global asset
management business
Giventherecenttrendinwhichcountriesaroundtheworldare
implementingmonetaryeasinginitiativesandenhancingtheir
legalframeworks,Mitsuiisexpandingitsrealestateassetman-
agementbusiness,combiningtheknowledgeoftherealestate
andfinancebusinesses,inbothdevelopedandemergingecono-
miesaroundtheworld.
Supporting corporate growth through the provi-
sion of management know-how and risk capital
Buyoutfundsandotherprivateequityfunds,whichprovide
managementknow-howandfunding,areplayinganincreas-
inglyimportantroleinsupportingcorporategrowth.Moreover,
fromtheviewpointofinstitutionalinvestorslookingtodiversify
investmentriskandinvestmenttargets,privateequityfundsare
expectedtocontinuetobeanattractiveassetclass.
Continued diversifi cation of global logistics
needs due to growth in consumer markets in
emerging economies
WhilelogisticstoandfromJapanaredeclining,intraregional
logisticsandlogisticsinfrastructureareexpectedtoexpand
amongemergingcountriesastheireconomiesandconsumer
marketsgrow.Furthermore,duetothediversificationofcon-
sumerneeds,thereisaneedforvalue-addedlogisticsservices.
IT&CommunicationBusinessUnit CorporateDevelopmentBusinessUnit
ExecutiveManagingOfficer,
ChiefOperatingOfficerof
IT&CommunicationBusinessUnit
NobuakiKitamori
ExecutiveManagingOfficer,
ChiefOperatingOfficerof
CorporateDevelopmentBusinessUnit
YasuyukiFujitani
BusinessOverview
MITSUI&CO.,LTD.ANNUALREPORT201660
Strengths
•Creationofbusinessmodelsthatleverageournetworkof
strongdomesticandoverseaspartners
•DevelopmentofnewbusinessareasthatleverageourcoreICT
subsidiariesandourresultsinventureinvestment
•Nurturingofhumanresourcesinmanagement,investment,
andriskmanagement
Updates of Current Medium-term Management Plan
Participation in TV shopping business in India
InOctober2015,Mitsuicompletedanadditionalinvestmentin
NaaptolOnlineShoppingPrivateLimited(Naaptol),whichoper-
atesaTVshoppingbusinessinIndia(Mitsui’scurrentshareis
approximately25%).Naaptolisaleadingcomprehensivehome
shoppingbusinessoperatorinIndia,whichmanages24-hourTV
shoppingchannels,merchandisingthatleveragesadvertising
networksande-commerce.
TheTVshoppingmarketinIndiaisexpectedtogrowatan
annualaveragerateof45%,anditwillreach¥500billionin
marketsizeby2020.Inthisbusinessenvironment,wedeliver
high-qualityproductstoourcustomersthroughNaaptol,which
supportstheoperationofmultilingualTVshoppingandnation-
widelogisticsnetworks,basedonourknow-howandexpertisein
TVshoppingbusinessesinJapanandChina.
Investment and participation in company
that develops and sells IoT data
management software
Mitsuihasenteredintoastrategicbusinesspartnershipwiththe
U.S.companyOSIsoft,LLC(OSIsoft),whichdevelopsandsells
IoT/M2M(MachinetoMachine)datamanagementsoftwarefor
industrialcustomers.Additionally,inMarch2016Mitsuiacquired
anequitystakeinthecompany.Recently,thereisagrowing
needforoptimizedoperationsthatleverageevenmore
sophisticateddataanalysisandvisualizationaswellas
innovationsinbusinessmodels.PISystem,adatamanagement
infrastructuredevelopedbyOSIsoft,hasahighlevelversatility
thatcancentrallymanageavastamountofoperationaldata,
workingtoimprovecustomers’operationalefficiency,quality,
andsafety,aswellassupporttheirstrategicdecisionmaking.PI
Systemhasbeenintroducedatover1,000electricandutility
companiesaswellasat95%ofmajoroilandgascompanies
aroundtheworld.Throughthisstrategicbusinesspartnership
andinvestment,wewillsupporttheexpansionofOSIsoft’sPI
Systemthroughitsglobalnetworkofaffiliatedcustomersand
businesspartnersandwilllooktodevelopnewIoTsolutionsthat
bridgeourcustomerswithOSIsoftandvariouspartners.
Initiatives in domestic buyout fund
InSeptember2015,Mitsuiestablishedtheprivateequityfirm
MSDInvestmentsLtd.(MSDInvestments)incollaborationwith
SumitomoMitsuiBankingCorporationandtheDevelopment
BankofJapanInc.Mitsuiinvested¥10billioninafundmanaged
byMSDInvestments,whichhasbegunoperations.
ManycompaniesinJapantodayfaceachallengingeconomic
environmentandawiderangeofmanagementproblems,
includingintensecompetitionindomesticandoverseasmarkets
aswellasbusinesssuccessionissues.Asastrategicpartnerwith
along-termoutlook,MSDInvestmentswillleveragethebroad
rangeofnetworksandbusinessknow-howpossessedbyits
threesponsorstorealizetheself-relianceandsustainabilityofits
portfoliocompanies.Inthisway,MSDInvestmentswillassist
thesecompaniesinadvancingtothenextphaseofgrowth.
MitsuiwilldrawuponitsexpansivenetworkbothinJapan
andoverseas,aswellasthebusinessmanagementknow-howit
hascultivatedovertheyears,tocontributetothegrowthofthe
portfoliocompaniesofMSDInvestmentsbysupportingtheir
globalexpansionandimprovingtheirmanagement.
ProgramshootingimageatNaaptol
Iron&Steel
Products
Mineral&Metal
Resources
Machinery&
Infrastructure
Chemicals Energy Lifestyle Innovation&
Corporate
Development
Americas Europe,
theMiddleEast
andAfrica
AsiaPacific
MITSUI&CO.,LTD.ANNUALREPORT2016 61
• Manyyearsofexperienceininvest-
ingintheUnitedStates,anincuba-
tioncenterfornewbusinesses
• Widerangeofbusinessactivities
withdeeprootsinSouthand
CentralAmerica
• Diversehumanresourceswith
strongrootsintheregion
• FastgrowingmarketssuchasTurkey,AfricaandtheMiddleEast
• Abilitytostructureprojectsinnewbusinessfieldsbasedon
relationshipswithtrustedleadinglocalpartnersestablished
overtheyears
• Diversehumanresourcesstronglyrootedinthelocalcommu-
nitiesthatenableustouncoverinnovativebusinessactivities
thatengagedistinctiveregionalcharacteristics,andpromptly
reacttochangesinthelocalbusinessenvironments
• Countriesandregionswhereeconomies
arecontinuingtogrowmarkedly
• Relationshipswithtrustedleadinglocal
partnersestablishedovertheyears
• Diversehumanresourceswithstrongroots
intheregion
StrengthsintheThreeOverseasRegionalSegments
©dgordonphotography
AmericasSegment
EMEA(Europe,theMiddleEastandAfrica)Segment AsiaPacificSegment
BusinessOverview
MITSUI&CO.,LTD.ANNUALREPORT201662
