Survey on Successful Cases of Secondary Investments by ... · led by the Semiconductor Group in...

Survey on Successful Cases of Secondary Investments

by Foreign-affiliated Companies in Japan

March 2006

Japan External Trade Organization (JETRO)

Invest Japan Department

Contents I. Survey Outline and Survey Results (Summary) ................................................................................1

II. Successful Cases of Secondary Investments ....................................................................................4

1. Greene, Tweed & Co., Japan

[Technical Support Center (Semicon Technopark in Kumamoto Prefecture)]................................4

2. Photon Dynamics, Inc.

[Support Center (North Chusei Scientific City in Mie Prefecture)]..............................................10

3. AMB Property Corporation

[Large-scale Leased Logistics Facilities (around Narita Airport)]................................................18

4. Haagen-Dazs Japan, Inc.

[Gunma Plant, R&D Center (Kanagawa Science Park), Branches/Shops]...................................23

5. Turbo Systems United Co., Ltd.

[Kansai Branch (Kobe), Kyushu Service Station (Fukuoka)].......................................................29

6. Avnet Japan Co., Ltd.

Kansai Office (Osaka), Nagoya Office, Mitaka Office, Logistics Center (Yokohama)]...............33

7. Founder International Inc.

[Osaka Office]...............................................................................................................................38

8. Continental Teves Corporation

[Head Office Relocation (Kanagawa Prefecture), R&D Center/Plant/Office (Chiba, Shizuoka and

Hiroshima Prefectures)] ..................................................................................................................42

9. Singapore Telecom Japan, Co., Ltd.

[Osaka Branch/Data Center] .........................................................................................................46

10. Nihon Weidmuller Co., Ltd.

(Chubu Branch).............................................................................................................................49

I. Survey Outline and Survey Results (Summary)

(1) Survey Outline

(i) Companies subject to survey: 10 companies

(ii) Business activities of 10 companies: Semiconductors x 2 companies, electronic components x 1

company, communications x 1 company, software x 1

company, LCD testing equipment x 1 company, machinery

x 2 companies, facilities provider x 1 company, food x 1

company

(iii) Timing of entry into Japan: 5 companies in 1980s, 4 companies in 1990s, 1 company in

2000s

(iv) Form of incorporation: Fully-owned subsidiary x 7 companies

Joint venture with a Japanese company x 3 companies

(v) Representative: Japanese x 5, foreigner x 5

(vi) Capital relationship: Affiliated to USA (including joint ventures) x 5 companies,

Germany x 2 companies, Switzerland (including joint

ventures) x 1 company, China x 1 company, Singapore x 1

company

(2) Survey Results (Summary)

1. Background to and Reasons for Expanding into Japan

(i) As Japan is the second largest economy in the world after the United States and has advanced

technologies, many companies that have expanded into Japan have cutting-edge technologies in

the field of machinery, semiconductors, software, etc. Also, many of them have the need to

sell technologies and products that Japanese companies do not have. However, business has

not necessarily been smooth all the time, as some companies were forced to curtail their

operations temporarily due to the recession in Japan and competition with domestic

manufacturers in the 1990s.

(ii) While some companies consider Japan as a hub in Asia, most companies are targeting the

massive Japanese market. Companies that have expanded into Japan have many subsidiaries

all over the world, and leave the marketing task in Japan to their Japanese subsidiaries. Their

sales channels are limited: many of them are controlled by the parent company headquartered

overseas.

2. Background to and Reasons for Establishing Foothold in Tokyo First

(i) The most common reason given was that demand is mostly concentrated in the metropolitan

1

area centering on Tokyo due to its large population, and that it is easy to sell in this massive

consuming region. Tokyo is attractive because it is home to the head office of client companies

through which business can be done, and because many contract partners are there.

(ii) There is an established belief that Tokyo—the center of information and culture—is a suitable

place to start business in Japan.

(iii) Companies headquartered in optimal locations in consideration of transport accessibility

including air routes are also noticeable in Tokyo.

3. Background to and Reasons for Making Secondary Investments in the Region

(i) When selecting secondary investment targets, emphasis is placed on being close to the client

(such as the client’s plant) and investments are made in anticipation of synergies.

(ii) Reasons for establishing a base in Osaka, Nagoya, etc. are similar to those in Tokyo, i.e., to meet

the needs of the market. However, many companies that have expanded into rural industrial

parks appreciate the treatment by the local authorities in the region including aftercare.

4. Unexpected Merits and Demerits

［Merits］

Companies appreciate the spaciousness of the site such as the shared space and the low cost of

offices. For example, Turbo Systems United Co., Ltd. (refer to P.29) which moved into HAT

Kobe—a large-scale waterfront redevelopment area integrated with Kobe Harborland—was

provided from Kobe City Government a section where it can fully deal with customers by combining

its sales functions with its workshop. Turbo Systems United cooperated with the redevelopment

concept of Kobe City and succeeded in blending into the local community by adopting a modern

design for its building and giving due consideration to its exterior and the townscape.

［Demerits］

Poor transport accessibility and difficulty in hiring staff have been pointed out by companies that

have established a base in rural areas with a relatively small population.

5. Wishes and Requests to Local Authorities, etc. in Making Secondary Investments

(i) Companies give priority to their own management strategies rather than the local authorities’

enticement activities and incentives. Nonetheless, they do consider using the incentives and

take into account the communication with local authorities. In other words, local authorities’

enticement activities and incentives are not as significant as the attractiveness of the local

authorities (regions), but are still important.

(ii) Many companies want JETRO, local authorities, etc. to hold enticement seminars and establish

2

inquiry counters. As foreign-affiliated companies, they seem to have concerns over Japan’s

contract system, reactions of local residents, etc.

6. Future Developments in Japan

(i) As in the case of expanding into Japan and making secondary investments, future developments

in Japan depend on the need of business expansion (including the needs of customers and client

companies). Companies also consider the cost effectiveness, branding and other such

subordinate needs.

(ii) Companies based in Tokyo which have expanded into Osaka and Nagoya are looking into rural

areas, although future developments will depend on the successfulness of their current activities.

Some companies are considering not only secondary investments but also mergers and

acquisitions (M&A).

3

II. Successful Cases of Secondary Investments

1. Greene, Tweed & Co., Japan

[Technical Support Center (Semicon Technopark in Kumamoto Prefecture)]

(1) Company Profile

(i) Company Name: Greene, Tweed & Co., Japan

(ii) Address: Tamachi Center Building, 5-34-7 Shiba, Minato-ku, Tokyo,

108-0014

(iii) Shareholder: Greene, Tweed International B.V. (Holland) 100%

(iv) URL: http://www.gtweed.com/ (Headquarters’ website)

(v) Representative: Representative Director Fumihiko Kawabata

(vi) Paid-in Capital: ¥70 million

(vii) Established: September 1986

(viii) Performance: Approx. ¥2.5 billion in annual sales

(ix) Number of Employees: 30 employees

(x) Places of Business: Osaka office (Osaka Prefecture, 1996)

Asia Engineering Center (Kumamoto Prefecture, 2005)

(xi) Business Activities: Import and sale of all products manufactured by Greene, Tweed &

Co. and its affiliates (sale of sealing products and high-performance

composite products)

(xii) Breakdown of Sales: In the Japanese subsidiary,

Semiconductor Group (= semiconductor-related seals, etc.): Approx. 75%

Fluid Handling Group (petroleum refinery and petrochemical-related seals, etc.): Approx. 14%

Aerospace Group (aircraft-related seals, etc.): 4% - 5%

Oilfield Group (seals for petroleum gas exploration, etc.): 3%

Medical & Biotechnology Group (seals for analytical instruments, etc.): 1% - 2%

Industrial Group (seals for industrial machinery, etc.): 1%

The parent company—Greene, Tweed & Co.—is a global seals (resistant materials) manufacturer

with annual sales amounting to approximately ¥20 billion. While the company in the United States

is effectively the headquarters, the holding company is in Holland. Its share in the global market

for hydraulic rings which alleviate the landing impact of aircraft is about 90%. It also has a large

market share for seals which reduce contamination arising in semiconductor manufacturing

equipment.

The Japanese subsidiary, which was originally established to sell aerospace-related products, now

4

primarily deals in products relating to the Semiconductor Group, while aerospace-related products

account for less than 5%. It is currently putting most of its efforts into selling products of the Fluid

Handling Group.

(2) Background to and Reasons for Expanding into Japan

(i) State of Enticement Activities, Incentives, etc. in Japan

There were hardly any enticement activities from Japan. The Company expanded into Japan based

purely on the Group’s global strategy.

(ii) Background to and Reasons for Selecting Japan

1) Greene, Tweed Group has manufacturing bases in the United States and the United Kingdom,

and its strategy is to have sales bases established in the form of fully-owned subsidiaries in key

markets around the world. It already has sales bases in Europe including the United Kingdom,

France, Germany and Spain, as well as in key markets such as Japan, South Korea, Thailand and

Taiwan. Its expansion into Japan is part of the Group’s strategy to have sales bases in key

markets.

2) Japan is a huge market, and the Company’s main products are all in demand in Japan. For this

reason, it was necessary to put in efforts through sales bases.

3) Technical support was previously provided to Asian countries from the United States but it was

difficult to satisfy customers because it was too far. Especially in the extremely competitive

market of semiconductor-related devices, the Company decided to establish the Asia

Engineering Center in Japan to cover technical support targeted at Asia as a whole.

(3) Background to and Reasons for Establishing Foothold in Tokyo First

(i) State of Enticement Activities, Incentives, etc. in Tokyo

1) There were no particular invitation activities or incentives by the Tokyo Metropolitan

Government.

(ii) Background to and Reasons for Selecting Tokyo

1) Tokyo is the capital of Japan and was deemed appropriate for starting business in Japan. It was

considered to be a convenient place in various aspects.

2) The first product marketed by the Group when it first expanded into Japan was hydraulic ring

(serving as a cushion for gears) which alleviates the landing impact of aircraft handled by the

Aerospace Group. The product was frequently delivered to the Defense Agency (Ground,

Maritime and Air Self-Defense Forces) and aircraft-related manufacturers such as

Ishikawajima-Harima Heavy Industries Co., Ltd., Teijin Seiki Co., Ltd. and Mitsubishi Heavy

5

Industries, Ltd., so Tokyo was regarded as a good place to engage in business activities. The

fact that Tokyo is a convenient place for marketing also played a part.

3) The office was established in Tamachi because it is close to both Haneda and Narita Airports, and

due to good transport accessibility.

(4) Background to and Reasons for Making Secondary Investments in the Region

(i) State of Enticement Activities, Incentives, etc. in the Region

1) The Company decided to open a technical support center named the “Asia Engineering Center”

led by the Semiconductor Group in Semicon Technopark in Kumamoto Prefecture in September

2004, and completed its construction on August 31, 2005.

2) The extremely enthusiastic staff of the Kumamoto Prefectural Government was the biggest

reason. The staff from the Kumamoto Prefectural Government attended “SEMICON WEST”

(a global exhibition held annually in the West Coast of the United States) in which the Company

was one of the exhibitors, and extended an invitation enthusiastically. The Company decided

to expand into Kumamoto Prefecture after building a sense of trust with each other. The staff

from the Kumamoto Prefectural Government were attentive on details and may be regarded as

topnotch salespersons (for their enthusiasm in marketing and reliable aftercare).

3) There were subsidies and property tax breaks.

(ii) Reasons for Selecting the Region

1) Enthusiastic invitation by the Kumamoto Prefectural Government was the biggest reason. As

technical support targeted at Asia on the whole is provided here, another appealing characteristic

is its proximity to regions where many customers of the Company are located, such as South

Korea and Singapore.

2) Semicon Technopark is 10 minutes away from Kumamoto Airport by car. Its good transport

accessibility was also appealing.

(5) Unexpected Merits and Demerits

The Company is not in the stage of being able to determine the merits and demerits because the

Center was completed only recently and is yet to launch operations on a full scale.

1) Currently, it is used only by the Semiconductor Group in relation to semiconductors, but if any

need arises in the future, there is a possibility of it being used by other Groups.

2) By coincidence, the Company’s Asia Engineering Center is sandwiched between plants owned

by Sony and Tokyo Electron Ltd., both of which are clients of the Company. In hindsight, it

was a good choice. However, this was not the reason for moving into the region.

6

(6) Wishes and Requests to Local Authorities, etc. in Making Secondary Investments

Enticement Activities, Incentives, etc.

1) What matters is enthusiastic staff, and building a trusting relationship. During a recent visit to

Tokyo, staff from the Kumamoto Prefectural Government paid a visit and had a meal togetherwith

members of the Company. Spaces in Semicon Technopark have sold out according to the staff.

2) Kumamoto Prefectural Government’s treatment was extensive and satisfactory.

3) Subsidies and tax breaks would help, but they are not the biggest determinants. Ultimately,

having a trusting relationship is important.

(7) Future Developments in Japan

Background to Activities in the Past and Future Developments in Japan

(i) The support center is a second-story building (1,050 square meters) built on a piece of land

measuring 6,104 square meters. Its activities include providing technical support to Asia

including Japan and improving products according to customers’ requests.

(ii) At the moment, the support center is still in the stage of just having had machinery carried in.

The plan is to start working with six staff, including three engineers. The first task is to get the

support center up and running. As all efforts are being made to determine how to use it and

what kind of steps to take, the Company is not considering expanding outside Kumamoto

Prefecture.

(iii) Only about a quarter of the support center is being used at the moment. There is plenty of

empty space, but there are no particular plans on whether to build a plant in the empty space or

how to utilize it: nothing has been decided. There are no plans to build a new building either.

(iv) The Company does not intend to utilize it as a warehouse because the storage of components,

equipment, etc. is outsourced to a distribution company with respect to orders, and supply can be

replenished domestically if there is any stock or imported from the United States if there is none.

(v) The Company deals in special products and is engaged in “solution marketing” aimed at

providing a solution according to customers’ requests. As this involves listening to customers’

needs and conducting product tests, it takes about six months from the time of commencement

of negotiations to the placement of orders in many cases. While the Company currently has

bases in Tokyo, Osaka and Kumamoto, there is a possibility of establishing sales bases

nationwide if its scope of business expands and the needs grow.

7

[Reference] Kumamoto Semicon Technopark

[Basic Information]

Location Fukuhara, Goshi-City, Oaza Haramizu, Kikuyo-machi, Kikuchi-gun, Kumamoto

Prefecture

Access Road: 11km to Kumamoto Interchange of Kyushu Jukan Expressway, 15km to

Mashiki Kumamoto Airport Interchange, 2km to National Highway No. 57

Airport: 8km to Kumamoto Airport

Railway: 3km to Haramizu Station and 4.5km to Higo Ozu Station of JR Hohi Main

Line, 21km to Kumamoto Station of JR Kagoshima Main Line (with cargo and

container handling facilities)

Port: 34km to Kumamoto Port (depth: 7.5m)

Institutional

Overview

Plant is constructed in Semicon Technopark by the Prefectural Government, and the

land and building (leased plant) are leased as a package for 10 years. A condition for

concluding a lease agreement is to purchase the land and building (leased plant) after

the expiry of the lease. (as of April 2004)

Other (i) Ground/geological conditions: Type 2 N value: 50 (-40m)

(ii) Service water: Industrial water supply 2,300/day, simple water-supply system

300/day

(iii) Drainage: Public sewer system in northern Kumamoto basin (via Kikuyo-machi

sewer system)

(iv) Electricity: 66,000V (via power distribution facilities), 22,000V (direct power

feeding)

(v) Gas: City gas

URL http://www.pref.kumamoto.jp/enterprise/ritti/news/news-cemicon.html

Inquiries Industrial recruitment & location division Kumamoto Prefectural Government

6-18-1 Suizenji, Kumamoto City 862-8570 Japan

TEL: +81-96-333-2329 FAX: +81-96-385-5797

8

[Other]

Items Description

Lots

concerned

・ 4-A, 4-B, 13

Industries

concerned

・ Electric machinery & apparatus manufacturing industry, metal products

manufacturing industry, etc.

Entry

conditions

・ Companies willing to establish first production base in Kumamoto Prefecture

・ Companies willing to purchase land and building (leased plant)after expiry of

lease

・ Companies which meet the business criteria set forth by the Kumamoto

Prefectural Government

・ Companies which can conclude a written agreement with conditions set by the

Prefectural Government

Clauses

requiring

Attention

Obligation to purchase after ten years, obligation to pay damages to the Prefectural

Government in the event of pulling out midway, obligation to submit to the

jurisdiction of the court having jurisdiction over the Prefectural Government in the

event of a lawsuit, etc.

[Location]

Kumamoto Semicon Technopark

Fukuoka City

Kitakyushu City

9

2. Photon Dynamics, Inc.

[Support Center (North Chusei Scientific City in Mie Prefecture)]

(1) Company Profile

(i) Company Name: Photon Dynamics, Inc.

(ii) Address: 1-1-21 Shibadaimon Tokyo 105-0012 Japan

(iii) Shareholder: Photon Dynamics, Inc. (USA) 100%

(iv) URL: http://www.photondynamics.com/ (Headquarters’ website )

(v) Representative: Representative Director Masayuki Nohda


(vii) Established: December 1991

(viii) Performance: ¥1.2 billion - ¥1.8 billion in annual sales


(x) Place of Business: Support center (Mie Prefecture, 2004)

(xi) Business Activities: Sale and maintenance of LCD testing equipment manufactured by

Photon Dynamics, Inc. (USA) (Japanese subsidiary is engaged in

sale and maintenance of all LCD testing equipment)

(xii) Breakdown of Sales: LCD testing equipment (100%)

Photon Dynamics, Inc. (Japan) is a fully-owned subsidiary of Photon Dynamics, Inc. (USA). The

parent company is a venture company founded in the United States, and developed LCD testing

equipment with the support of the Defense Advanced Research Projects Agency (DARPA), a

semi-governmental corporation in the United States, as well as private investors. In view of the

future potential of LCDs, development efforts were actively being made at the time in the United

States as well, and Photon Dynamics, Inc. (USA) developed the core technology. However,

Japanese manufacturers later dominated LCD production as the LCD industry fundamentally

requires money (i.e., huge capital investment) and human resources.

This increased the need to tap the Japanese market, so in 1991, the early days of LCDs, the

Company formed an alliance with Ishikawajima-Harima Heavy Industries Co., Ltd. (IHI) and

embarked on the development, sale and maintenance of LCD testing equipment in Japan. The

alliance was formed based on the view that a partner is needed to run an equipment business.

While IHI is a partner on the development front, the two companies have no capital relationship.

As the business of Photon Dynamics, Inc. is limited solely to LCDs, its clientele is limited.

Accordingly, the Japanese subsidiary’s website was deemed unnecessary and was thus abolished.

Information is disclosed on the headquarters’ website (refer to above).

The support center established in 2004 is in an office (approx. 90 square meters) in Anotsu-Pia, a

10

complex with conferencing and training rooms located in North Chusei Scientific City, which

stretches across Tsu City and Kawage-cho, Mie Prefecture.



1) Although research on LCDs had been conducted in the United States as well, Japanese

companies became the dominant force by the early 1990s. In response, the Company decided

to establish a base in Japan.

2) Initially, it was just a satellite office of the United States, and sales and support services were all

undertaken by the Company’s partner IHI. The Company subsequently established a local

subsidiary and started putting efforts in it, based on the view that it is necessary to enhance

support services.

3) The Company later established subsidiaries in Taiwan and South Korea as well, as Taiwanese

and South Korean manufacturers began to manufacture LCDs. The Japanese subsidiary is

purely focused on the Japanese market.


1) Japan was chosen because Japanese manufacturers were the only ones engaged in the large-scale

production of LCDs at the time. Back then, South Korean and Taiwanese LCD manufacturers

were not even toddlers. Put differently, the Company expanded into Japan due to demand.



1) There were absolutely no enticement activities or incentives by the Tokyo Metropolitan

Government.


1) A consulting firm that had worked hard for the Company to form the alliance with IHI found an

office near the current office. The Company later moved to an office in Gotanda, and moved

again to the current office.

2) It is close to Narita and Haneda Airports, and has good transport accessibility.

3) It is close to the office of the Company’s partner IHI, and has good access.

4) It is close to an electric-appliance manufacturer which is one of the Company’s client

companies.

11



1) There were no particular incentives. There were no subsidies or property tax breaks either.

2) The Industrial Investment Promotion Division of the Mie Prefectural Government approached

and enticed the Company. The staff was extremely enthusiastic, even bringing a property list

to provide an explanation. The staff was probably more eager than the real estate agent in town.

Their aftercare is good in that even after moving in, they visited the Company’s office and asked

how things have been going since the move.

3) It is close to Kameyama Plant of Sharp Corp., which is a major client of the Company. Photon

Dynamics equipment is covered by a one-year warranty, but the risks are high due to the

state-of-the-art technology, so it was necessary to establish a framework that is capable of

providing maintenance services to its customers at any time.


1) The place was chosen because the plant of a major client was nearby. In 2002—prior to

moving into the region in 2004—support and other services were provided by employees

staying at hotels, etc. for an extended period of time. Then, a proposal to establish a support

center was made, so the Company moved into the region due to the need to have a proper office.

2) Initially, there were six employees, but now there are nine employees engaged in activities.

The Tokyo office is primarily in charge of the LCD plant in Chiba Prefecture.


(i) Merits

1) Response to clients has improved dramatically.

2) Costs were lower than expanding the office space in Tokyo.

3) The shared space is large. It appears to have been built for local venture companies and it

accommodates many local companies. It is more “office-like” than “SOHO-like”.

4) The car park is spacious and is free.

5) Satisfaction rating of the office is about 75%.

(ii) Demerits

1) It is difficult to hire personnel. The Company does not recruit new graduates; it looks for

potential recruits using the web and hires individuals who can contribute immediately and

individuals who may not necessarily have knowledge of LCDs but have similar knowledge.

However, the population of potential recruits is small.

2) Many people are reluctant to work in Mie Prefecture. In particular, it is difficult to hire

12

individuals who have technical capabilities and have the ability to communicate in English.

3) It is located far away from the center of Tsu City, and has poor transport accessibility. There is

no public transport, so employees are forced to commute by car. While the Company allows

flexible working hours to make life easier for commuters, the Company believes there should

at least be a bus service available.



(i) Efforts should be made to enable the recruitment of engineers, especially the recruitment of

individuals who can communicate in English. This is based on the view that human resources

are fundamental to the company.

(ii) The rent of the office should be much lower.

(iii) Subsidies and tax breaks would help, but they would not be reasons for moving into the region.



(i) Clients were initially dealt with by the Tokyo office. Later, a client built a large plant in Mie

Prefecture, so the Company expanded into the region.

(ii) The Company intends to expand the scale of the support center in Mie Prefecture, but has no

plans to expand into other regions.

(iii) However, if a client company builds a large plant in another region in Japan, the Company will

expand into the region after determining whether it would be better to do so than dispatching

personnel from Tokyo.

13

[Reference] North Chusei Scientific City

(1) North Chusei Scientific City

[Basic Information]

Location 1-chome through 5-chome, etc. Anotsudai, Tsu City, Mie Prefecture

Access Approx. 6.8km to JR/Kintetsu Tsu Station

5.8km from Geino Interchange of Kinki Expressway, 6.0km from Tsu Interchange

Institutional

Overview

The objective is to develop a new city with industrial, advanced urban and residential

functions in an area stretching across the northern parts of Tsu City and western parts

of Kawage-cho. In 1993, parts of the Scientific City were designated as “Office

Arcadia” where offices, laboratories, everyday service facilities, etc. are clustered

under the Law for Comprehensive Development of Regional Core Cities with

Relocation of Office-Work Function.

The area (approx. 169ha) which faces Chusei Bypass and has Office Arcadia at its

center is currently being developed as Phase I Project Area. The introduction and

development of industrial and logistic functions in conjunction with R&D functions

by attracting laboratories and offices in Office Arcadia will enable consistent

industrial activities from R&D all the way up to production and distribution. At the

same time, housing and parks will be developed to create residential, sports and

recreational areas for employees and local residents. Additionally, lots are being sold in Tsu Office Arcadia promoted by the Japan

Regional Development Corporation (JRDC) and the industrial and logistics zone

promoted by the Tsu Municipal Corporation of Land Development.

Furthermore, main access road Chusei Bypass of National Highway No.23 (Kawage

industrial zone) and city road Ozato Mutsuai Yamamuro-cho line have been opened,

and Chusei Green Park (a comprehensive park) has been opened partially and is

frequented by citizens.

The detached housing area is a residential zone in North Chusei Scientific City, and is

seeking to grow into a leafy detached housing district that blends in with the

surrounding natural environment by taking advantage of its suburban residential

characteristics.

14

[Basic Information] (Continued)

Facilities Office Arcadia (Organization for Small & Medium Enterprises and Regional

Innovation, Japan (SMRJ)): Development area 38.7ha

Area sold in lots 25.2ha

Industrial, logistics and residential areas (Tsu Municipal Corpration of Land

Development): Development area 97.5ha (industrial area: 43.0ha, logistics area:

37.4ha, residential area: 17.1ha)

Chusei Green Park: Area 28.3ha

Designated

Area

Chubu land development area, optimal plant location, industry invitation region

URL http://www.ztv.ne.jp/web/anotsupia01/saiennsucity.html

Inquiries Industrial Investment Promotion Division Department of Commerce, Industry and Sightseeing Tsu Municipal Office 23-1 Nishi-Marunouchi, Tsu City, Mie Prefecture 514-8611 Japan TEL: +81-59-229-3263 E-mail: [email protected]

15

(2) Tsu Science Plaza Corporation

[Basic Information]

Location Anotsudai, Tsu City, Mie Prefecture

This was developed as the core facility to support industrial and business functions of

Tsu Office Arcadia at the heart of North Chusei Scientific City, which is planned in the

region stretching across the northern parts of Tsu City (the capital of Mie Prefecture)

and the western parts of Kawage-cho.

Scientific City is a project pursued by Tsu City together with its neighbor Kawage-cho,

with the aim of developing a new city with industrial, advanced urban and residential

functions. Tsu Office Arcadia—the core of Scientific City—has already been

launched as an enterprise by the Japan Regional Development Corporation (JRDC).

In order to materialize the Tsu Office Arcadia enterprise, it was established in April

1996 as a joint public-private venture with the cooperation of JRDC, Mie Prefecture,

Tsu City, Kawage-cho and 41 private-sector companies, as a facility equipped with

core functions to promote IT industries with developed infrastructure, nurture

next-generation R&D and entrepreneurs, induce joint industry-government-academia

research and other various activities including human resources development and

exchanges and foster venture companies, while serving as the symbol of North Chusei

Scientific City and Tsu Office Arcadia.

Main facilities developed in Anotsu-Pia under the Phase 1 Project include facilities to

conduct joint R&D with universities, incubator room (a facility to support

entrepreneurs), training and conferencing facilities for human resources development,

Tsu City Area Information Center (a facility with information functions), leased offices

(business facilities), restaurants, cafés and commercial stores (convenient facilities for

a wide range of citizens) and the entrance used as exchange facilities. These

multifunctional facilities commenced operation in April 2002.

Established April 3, 1996 (registered)

Paid-in

Capital ¥1,568 million

16

[Basic Information] (Continued)

Major

Shareholders

Organization for Small & Medium Enterprises and Regional Innovation, Japan

(SMRJ) (former Japan Regional Development Corporation (JRDC)), Mie Prefecture,

Tsu City, Kawage-cho, Chubu Electric Power Co., Inc., JFE Engineering Corp.

(former NKK Corp.), Hyakugo Bank, Ltd., NTT West Corp., Tsu Chamber of

Commerce and Industry, Matsushita Electric Works, Ltd., Mie Kotsu Co., Ltd., Godo

Gas Co., Ltd., Matsushita Electric Industrial Co., Ltd., Okamura Corp., Sekisui

House, Ltd., Misawa Homes Co., Ltd., Fujitsu Ltd., AEON Co., Ltd., Daiwa House

Industry Co., Ltd.

URL http://www.ztv.ne.jp/web/anotsupia01/gaiyou.html

Inquiries Tsu Science Plaza Corporation

4-6-1 Anotsudai, Tsu City, Mie Prefecture 514-0131 Japan

TEL: +81-59-236-3104 FAX: +81-59-236-3108

[Location]

Tokyo

Nagoya City

North Chusei Scientific City

17

3. AMB Property Corporation

[Large-scale Leased Logistics Facilities (around Narita Airport)]

(1) Company Profile

(i) Company Name: AMB Property Corporation

(ii) Address: US Headquarters Pier 1, Bay 1, San Francisco, California

94111 USA

Japanese Branch Sanno Park Tower, 2-11-1 Nagata-cho,

Chiyoda-ku, Tokyo 100-6105 Japan

(iii) Shareholders: Undisclosed

(iv) URL: http://www.amb.com (Headquarters’ website)

(v) Representative: Chairman & CEO Hamid R. Moghadam

Japanese Representative Frederick Wyler

(vi) Paid-in Capital: Undisclosed

(vii) Established: 1983

(viii) Performance: Approx. ¥79.8 billion in annual sales, approx. ¥885 billion in

total assets

(ix) Number of Employees: 234 employees in total, including 12 employees in Japanese

branch

(x) Owned Logistics Facilities: Narita City, Chiba Prefecture; Tokorozawa City, Saitama

Prefecture; Ohta-ku, Tokyo; Amagasaki City, Hyogo Prefecture;

Funabashi City, Chiba Prefecture; Kawasaki City, Kanagawa

Prefecture; Koto-ku, Tokyo (under construction), etc.

(xi) Business Activities: Logistics properties business

(xii) Breakdown of Sales: Undisclosed

<Partner in Japan>

(i) Company Name: AMB BlackPine Ltd.

(ii) Address: Sanno Park Tower, 2-11-1 Nagata-cho, Chiyoda-ku, Tokyo

100-6105 Japan

(iii) Shareholder: AMB Property Corporation 50%

(iv) URL: http://www.amb-blackpine.com/index2.html

(v) Representative: Stewart Gibson


(vii) Established: April 2003

(viii) Performance: Undisclosed

18

(ix) Number of Employees: Approx. 30 employees

(x) Places of Business: Tokyo branch, Osaka branch, Chubu branch (Nagoya City)

(xi) Business Activities: Acquisition and construction of logistics properties, due

diligence and lease-related services




There were no enticement activities from Japan. The Company expanded into Japan based solely

on its global strategies.


1) AMB Property Corporation had been dealing with FedEx, DHL, Nippon Express, Kintetsu, etc.

in North America, especially in Chicago, Los Angeles and New York. As these companies

started inquiring about logistics facilities in Asia and expressed their interest in using them if

there are any, the Company started to consider expanding into Asia five years ago. This is

because the Company stresses the importance of running its business by meeting customers’

needs in a flexible manner.

2) Japan is the second largest economy in the world, and Tokyo International Airport (Narita) is the

world’s second largest airport in terms of cargo handling volume. As the Japanese economy is

showing signs of recovery and land prices appear to have bottomed out and seem to be ready to

take an upturn in some areas, the Company was convinced that it could perform well on the back

of the increase in logistics demand in Japan.

3) Preliminary surveys have revealed that cargo at Narita Airport consists mainly of computers and

electronic goods and even fresh foods, spanning a wide range of fields. In some cases, the

cargo would be unloaded there and then be transported to another country in Asia. Accordingly,

the Company determined that warehouse demand would be large.

4) The Company had three options when expanding into Japan: forming an alliance with a major

real estate company; entering into Japan by itself; or forming a partnership with a small number

of experienced professionals. The Company opted to expand into Japan by forming a

partnership with a small number of experienced professionals, which enables the speedy

execution of business. This approach has been extremely successful in the United States as

well, and is adopted in Germany and France.

5) The Company’s partner and joint venture company AMB BlackPine Ltd. is in charge of the

development of investment projects (such as marketing, development, tenant searching) and

leasing. AMB Property Corporation has the final say.

19



There were no particular invitation activities or incentives by the Tokyo Metropolitan Government.


1) Tokyo is the capital of Japan, and the headquarters of large companies are concentrated in Tokyo.

It is natural to select Tokyo as the place to establish the first foothold for doing business.



There were no particular enticement activities or incentives.


1) As mentioned above, Tokyo International Airport (Narita) is the world’s second largest airport in

terms of cargo handling volume. As the Japanese economy is showing signs of recovery and

land prices appear to have bottomed out and seem to be ready to take an upturn in some areas,

the Company was convinced that it could perform well on the back of the increase in logistics

demand in Japan.

2) Preliminary surveys have revealed that cargo at Narita Airport consists mainly of computers and

electronic goods and even fresh foods, spanning a wide range of fields. In some cases, the

cargo would be unloaded there and then be transported to another country in Asia. Accordingly,

the Company determined that warehouse demand would be large.

(iii) Reasons for Selecting Regions Other than Narita

1) The selected sites are located in the so-called outskirts of the capital, including Tokyo,

Kanagawa Prefecture, Chiba Prefecture and Saitama Prefecture, and both Tokorozawa and

Funabashi have superior locations to a certain extent.

2) In Funabashi, properties are next to each other and there is room for future redevelopment.

3) There are no particular problems in the credit of tenants, and the properties were deemed

adequate for investment.


(i) Merits

1) Local authorities are cooperative in expanding roads and installing new traffic lights.

2) When establishing logistics facilities in redevelopment areas, the local authorities act as a

coordinator with respect to the government and as a mediator in discussions with residents

20

regarding noise control measures, etc.

(ii) Demerits

There are none in particular.



(i) In corporate activities, subsidies and assistance from the government and local authorities are

not particularly required at the moment. They are highly cooperative when the Company asks

for the expansion of roads and installation of new traffic lights to cope with the increased traffic

volume resulting from the opening of a large-scale logistics center.

(ii) The Company relies on the services of the government when it establishes logistics facilities in

redevelopment areas. The government is also relied upon as a mediator when discussions with

residents are needed over noise control measures, etc. due to the 24-hour operation of trucks.



(i) Typical warehouses in Japan are old models and are inflexible. The competitive edge of global

companies like AMB Property Corporation lies in flexibility, efficiency, speediness,

reasonableness and high quality. It is natural that the demand for such flexible, efficient

warehouses is increasing in the logistics industry, which has been experiencing rapid changes in

recent years.

(ii) An overwhelming majority of warehouses in Japan lift vehicles by elevator, whereas AMB

Property Corporation’s warehouses may be regarded as being more efficient for adopting a ramp

system that requires no elevators. The leased area varies from 2,000/3,000 square meters to

30,000 square meters to meet demand of any kind.

(iii) In July 2005, AMB Property Corporation established the Japan Fund (¥247 billion) aimed at

expanding logistics facilities in Japan. Investment targets include airport and port regions such

as Keihin region, Osaka Port and Kobe Port.

(iv) The Company currently owns logistics facilities measuring more than 372,891 square meters

including properties under development, having invested about ¥70 billion over the past three

years. There is plenty of cash left as only a third of the Fund has been spent so far; therefore,

the plan is to invest in Nagoya this year. The Company is also looking into investing in

Kitakyushu, Sendai, etc. within the next two years.

(v) In some cases, the Company develops and constructs special logistics facilities according to the

customer’s request. Investments are being made at a much faster pace than initially expected.

21

Investment in Japan will still have sufficient merits even after the maturity of the Japan Fund, so

the Company is thinking about launching Japan Fund 2 and even an Asia Fund.

(vi) Japanese general trading companies, etc. have started to enter into the logistics facilities

business lately, but expertise is required in this field. As the Company has outstanding

knowledge and experience, it should sustain its superiority for some time to come.

22

4. Haagen-Dazs Japan, Inc.

[Gunma Plant, R&D Center (Kanagawa Science Park), Branches/Shops]

(1) Company Profile

(i) Company Name: Haagen-Dazs Japan, Inc.

(ii) Address: 2-1-1 Kamimeguro, Meguro-ku, Tokyo

(iii) Shareholders: General Mills HD Japan B.V. (50%), Suntory Ltd. (40%), Takanashi

Milk Products Co., Ltd. (10%)

(iv) URL: http://www.haagen-dazs.co.jp/

(v) Representative: President & Representative Director Takuya Nakanishi


(vii) Established: August 1984

(viii) Performance: ¥41.6 billion in sales (FY2004)

(ix) Number of Employees: 235 employees (145 males, 90 females)

(x) Places of Business: Sales bases = Sapporo (1991), Sendai (1991), Nagoya (1991), Osaka

(1985), Hiroshima (1993), Fukuoka (1991)

R&D center (Kanagawa Prefecture, 1995)

Gunma Plant (Gunma Prefecture, 1984)

Shops (73 shops nationwide, centering on Tokyo Metropolitan Area

and Kinki region)

(xi) Business Activities: i. Production, import and sale of dairy products such as ice cream

ii. Production, import and sale of ice sweets, confectionery and other

food products

iii. Management of ice cream shops and franchise operations

iv. Operations incidental to the activities stated above.


Haagen-Dazs is a leading American manufacturer whose main product is ice cream. Haagen-Dazs

was sold by its founder to American food company Pillsbury Co. and subsequently became a

division of General Mills, Inc. following the acquisition of Pillsbury by General Mills.

It currently operates approximately 700 Haagen-Dazs shops around the world, where customers can

have the ultimate Haagen-Dazs experience. Its basic policy is ESPP, the acronym of

Environment, Service & Smile, Product and People.



23



Even before Haagen-Dazs expanded into Japan in 1984, its brand of ice cream was popular for its

palatability among Japanese tourists who visited Hawaii and the mainland United States. The

timing of Pillsbury’s acquisition of Haagen-Dazs was good in that it resulted in Pillsbury agreeing

with Japan’s Suntory Ltd.—which was contemplating its international strategy at the time—to

establish a joint venture company. (Negotiations had actually been taking place for some time.)

While Suntory had an edge in alcoholic beverage, it did not deal in dairy products, so it asked its

client and blue-chip diary products manufacturer Takanashi Milk Products Co., Ltd. to join in as well,

and together they established a joint venture company. Currently, General Mills HD Japan B.V. has

a 50% stake in Haagen-Dazs Japan, Inc., while Suntory and Takanashi Milk Products have a 40%

stake and 10% stake, respectively.

Haagen-Dazs Japan’s operations are limited to Japan. This is part of Haagen-Dazs’ global strategy.

Haagen-Dazs Japan released five types of products in department stores and high-end supermarkets

in Tokyo in 1984, and started importing Haagen-Dazs Ice Cream Bar following the deregulation of

ice cream import in 1990. It subsequently expanded its sales channels to owned-and-operated shops

and even convenience stores, and has recently been making inroads actively into cinema complexes

and in-flight services on international flights. Its sales amounted to ¥33.4 billion in FY1998, and

have been increasing gradually in the following years, reaching ¥41 billion in FY2003 and ¥41.6

billion in FY2004. Domestically-manufactured products account for 90% of all products sold, while

imports account for the remaining 10%.





1) Tokyo is the capital of Japan, and is the center of information, economy and culture.

2) Transport accessibility is good.

3) All companies expanding into Japan would probably consider Tokyo first.



［Gunma Plant］

1) A plant of Takanashi Milk Products, which is one of the stakeholders of Haagen-Dazs Japan, is

24

located here. Haagen-Dazs Japan’s plant is situated inside Takanashi Milk Products’ plant.

2) The plant is operated by Takanashi Milk Products. Its extremely strict quality standards met

Haagen-Dazs Japan’s requirements.

3) It is close to the Tokyo Metropolitan Area—the biggest consuming region—and is logistically

suitable. However, it may not necessarily be the one with the lowest cost.

［R&D Center］

The R&D center was established in Yokohama in 1995, and was relocated to Kanagawa Science

Park (KSP) in Kawasaki in 2004, because:

1) The site in Yokohama became too small;

2) The specifications allowed easy development (waterworks, lines and other facilities were in

place); and

3) It is close to the head office.

Currently, 10 employees are developing ice cream with flavors tailored to the Japanese.

［Branches］

Branches were opened in large consuming regions where demand existed.

［Shops］

1) Shops were opened in various locations to help improve the brand.

2) Scrap-and-build is executed on a timely basis.


The construction of the plant and the opening of shops were not a result of invitation by local

authorities to begin with, so there are no particular merits or demerits as such.



As stated above, the plant was opened because the plant owned by Takanashi Milk Products was

suitable for production. It was not done in response to requests by local authorities, etc., so there

are no particular requests.



(i) There are no plans to establish a new plant.

25

(ii) It is impossible to consider opening shops without property. The Company will determine

whether or not they will help improve branding before opening them.

(iii) However, the Company will not pursue numbers just for the sake of it.

(iv) Shops will not be opened in response to enticement activities in rural areas, but they might turn

out to be consistent with the Company’s shop-opening strategies.

26

[Reference] Kanagawa Science Park (KSP)

[Basic Information]

Location Sakato, Takatsu-ku, Kawasaki City, Kanagawa Prefecture

Access 15-minute walk from Musashi-Mizonokuchi Station of JR Nanbu Line or

Mizonokuchi Station of Tokyu Den-en Toshi Line. Free shuttle bus service is

available from bus terminal in front of the station.

Institutional

Overview

KSP is Japan’s first urban science park established in 1989, and is one of the biggest

high-tech incubators in the country. It is a creative center of science and technology

for the 21st century. It supports the creation of new industries and serves as a

promoter of exchanges between R&D-oriented companies. Exhibitions, events, etc.

relating science, technology and industry are held in the gallery and the hall.

KSP was established in 1989 as Japan’s first science park promoted by Kanagawa

Prefecture and Kawasaki City with the backing of the Japanese government and the

cooperation of private-sector companies. It is characterized by the support provided

in partnership with Kanagawa Academy of Science and Technology (KAST), which

promotes R&D, and Kanagawa High-Technology Foundation (KTF), which is in

charge of patent distribution and tests & measurements (KAST and KTF merged in

April 2005). Many laboratories and R&D-oriented companies are clustered in this

favorable research environment.

Established December 19, 1986

Paid-in

Capital ¥4.5 billion

Major

Shareholders

Kanagawa Prefectural Government, Kawasaki City Government, Development Bank

of Japan and 46 companies including Tobishima Corporation

Facilities

(Functions)

East Wing of Innovation Center Building (1. Functions to support the growth of

R&D-oriented companies, 2. R&D support functions)

West Wing of Innovation Center Building (1. Exchange functions, 2. human

resources development functions, 3. business support service functions)

R&D Business Park Building (1. space leased to R&D-oriented companies, 2.

business support service functions)

URL http://www.ksp.or.jp/

Inquiries KSP Inc.

3-2-1 Sakato, Takatsu-ku, Kawasaki City, Kanagawa Prefecture 213-0012 Japan

TEL: +81-44-819-2001 E-mail: [email protected]

27

[Location]

Tokyo

Yokohama City

Kanagawa Science Park

28

5. Turbo Systems United Co., Ltd.

[Kansai Branch (Kobe), Kyushu Service Station (Fukuoka)]

(1) Company Profile

(i) Company Name: Turbo Systems United Co., Ltd.

(ii) Address: Arca Central Building, 1-2-1 Kinshi, Sumida-ku, Tokyo, 130-0013

Japan

(iii) Shareholders: ABB Turbo Systems AG (Switzerland), Ishikawajima-Harima

Heavy Industries Co., Ltd. (50% each)

(iv) URL: http://www.turbo.co.jp

(v) Representative: President & Representative Director Michael Brandt


(vii) Established: October 1998

(viii) Performance: ¥7.8 billion in sales (Year ended March 31, 2005)


(x) Places of Business: Kansai branch (Kobe City, 2004) 1 Kyushu service station

(Sue-machi, Fukuoka Prefecture, 2005)2, East Japan service station

(Sumida-ku, Tokyo, 1998), Takamatsu office (Takamatsu City,

Kagawa Prefecture, October 1998)

(xi) Business Activities: Sale of turbochargers made by ABB Turbo Systems and

Ishikawajima-Harima Heavy Industries, technical consulting for

turbocharger applications, repair of turbochargers, sale of spare parts,

planning and implementation of daily maintenance and preventive

maintenance of turbochargers




ABB Turbo Systems AG and Ishikawajima-Harima Heavy Industries Co., Ltd. (IHI) established a

joint venture company to progressively dissolve their technical alliance over 40 years and to enhance

their service networks.


1) Due to the large shipbuilding market in Japan, ABB Turbo Systems has been doing business in

1 Kansai branch, Omiya parts center and Rokko service station were relocated and consolidated. 2 Fukuoka office was relocated after adding service functions.

29

Japan for more than 100 years.

2) ABB Turbo Systems and IHI formed a technical alliance in 1958 and have since been supplying

turbochargers for diesel engines for ships and power-generation purposes to the Far East market.

In order to adapt to the globalization of the market, they established Turbo Systems United Co.,

Ltd. for sales and after-sales service as part of their efforts to further enhance their relationship,

as turbochargers are costly machines to develop.

3) Turbo Systems United is not a mere distributor, as it cooperates in the development of

technologies with ABB Turbo Systems and IHI, and provides technical consulting services on

engine-related applications. It also trains service engineers dispatched to ports around the

world.





Whether to select Kobe or Tokyo was debated. The market is bigger in Kansai, but Tokyo was

selected partly for the purpose of ensuring communication with employees and stakeholder IHI,

which is headquartered in Tokyo.





1) The Company offers repair services 24 hours a day, procures spare parts and dispatches service

engineers across Japan and to other countries. Therefore, its requirements are being close to a

port and airport and having access to highways.

2) The Company was able to establish both Kyushu service station and Kansai branch in places

which satisfied those requirements.


1) Fukuoka Prefectural Government learnt about the Company’s plan to move into Fukuoka

Prefecture and made contact, asking for a meeting and offering cooperation if any help is needed.

As the site was selected by the Company and no specific requests had been made to the

Prefectural Government, its positive stance left a good impression.

30

2) The construction site of Kansai branch was in HAT Kobe (120ha), a large waterfront

redevelopment area integrated with Kobe Harborland in Sannomiya. The Kobe City

Government provided a section in response to the Company’s requests.

3) It is impossible to deal with customers sufficiently unless the sales functions and the workshop

are integrated. As there were no optimal locations other than HATKobe, the Company would

have had to look for an alternative site if it was not permitted to move in.

4) The Company cooperated with the redevelopment concept of Kobe City and adopted a modern

design for all wings of the branch’s building and gave due consideration to its exterior and the

townscape.



1) Generally speaking, the image of the government as a “regulator” is so strong that there is no

open atmosphere that allows casual inquiries. The Company believes it would be good to have

a general inquiry counter that can handle all types of inquiries. Fukuoka Prefectural

Government has such a framework and its section chief went out of his way to visit the

Company after finding out that it was moving in, but few local authorities probably have such a

framework.

2) In Switzerland, the “town” and “company” are integrated. Citizens are allowed to walk into

the plant’s premises freely, and some facilities on the premises are opened to citizens in some

cases. The community-oriented nature of companies is probably a reflection of the good

relationship between the government and companies.

3) The Company is a joint venture so there are no particular problems, but foreign companies that

have expanded into Japan are complaining about the lack of information and communication.

The Swiss Embassy convenes a meeting periodically with companies which have expanded into

Japan, which the President of Turbo Systems United attends. The Company believes this kind

of follow-up is required for foreign companies that do not belong to trade groups.

4) The Company needs to establish bases in Hokkaido and other northern regions in the future.

The Company wonders how much support the local authorities will give to a small company like

Turbo Systems United. Good care of small companies will be highly appreciated. by the

Company.

31



1) Kyushu service station consists of an office wing and a plant wing. Its location is excellent in

terms of transport accessibility: it is a 5-minute drive away from Fukuoka Interchange, and a

20-minute drive away from Fukuoka Airport.

2) The establishment of Kyushu service station has enabled speedier service with respect to many

turbochargers for onshore power generation all over Kyushu including isolated islands.

3) In the future, the Company will provide maintenance and repair services for large turbochargers

for ocean vessels entering Kitakyushu Port.

4) Kansai branch is in the waterfront area, and is close to JR and Hanshin Electric Railway’s

stations (approx. 5-minute walk). The objective of integrating the previously-dispersed office,

parts center and service plant has been fulfilled as well.

5) Kansai branch’s new parts center gained the capacity to handle massive shipments quickly as a

result of introducing a cutting-edge automatic control device. Therefore, it can now deal with

urgent orders meticulously.

6) Kansai branch holds seminars targeted at customers and conducts inspection tours at the plant

and parts center.

32

6. Avnet Japan Co., Ltd.

Kansai Office (Osaka), Nagoya Office, Mitaka Office, Logistics Center (Yokohama)]

(1) Company Profile

(i) Company Name: Avnet Japan Co., Ltd.

(ii) Address: 19F Bunkyo Green Court Center Office, 2-28-8 Honkomagome,

Bunkyo-ku, Tokyo, Japan

(iii) Representative: Representative Director Tom McCartney

(iv) Paid-in Capital: ¥490 million

(v) Shareholder: Fully-owned subsidiary of Avnet, Inc. (USA)

(vi) URL: www.avnet.co.jp

(vii) Established: April 1, 1983

(viii) Performance: ¥16.9 billion in annual sales (fiscal year ended December 31, 2004)

(ix) Number of Employees:165 employees

(x) Places of Business: Logistics center in Yokohama City, offices in Osaka City, Nagoya

City and Mitaka City

(xi) Business Activities: i. Sale of and technical support for electronic components of

semiconductors and demo boards

ii. Sale of and technical support for electronic circuit development

support tools (design software, logical simulators, etc.)

iii. Sale of and technical support for IP and middleware, system

design

Avnet, Inc. is a technology distributor (a trading company specializing in semiconductors and

electronic components) which was founded in the United States in 1921, became a joint-stock

company in 1955, and was listed on the New York Stock Exchange in 1960 (NYSE: AVT). Avnet

is the world’s largest company in this sector, with annual sales amounting to approximately ¥1.5

trillion (Avnet consists of two operation groups: the Electronics Marketing Group, which accounts

for 57% of total sales, and the Technology Solutions Group, which accounts for the remaining 43%).

To date, it has expanded into 70 countries across the world and it currently has 300 bases.

Its Japanese subsidiary is fully owned by Avnet, Inc. (USA), and currently runs a business focusing

on the sale of products from multiple suppliers (semiconductor manufacturers) and technical

support.

It changed its company name from Memec Japan K.K. to Avnet Japan Co., Ltd. following the merger

of its parent company Memec Group Holdings Ltd. with Avnet, Inc. (USA) last year.

Its future policy is to introduce a Design Chain (support spanning from concept planning to

33

specification setting and hardware/software designing to meet customers’ needs) and Supply Chain

(delivery support pursuing customer satisfaction by improving costs and time efficiency) in

accordance with the business model in the United States. For the time being, however, Avnet Japan

intends to further enhance Design Chain support which involves creating demand based on the

business resources nurtured in Japan to date. Its policy is to run its business purely on a customer

basis in compliance with the distribution rules in Japan.



There were none in particular.


Reasons: Avnet Japan has expectations for the size of the Japanese semiconductor market

(approx. ¥5 trillion).

Background: From the viewpoint of the U.S. headquarters, the merger has made it possible to

utilize existing business resources with similar business frameworks, and do business

in Japan while enjoying the resulting merits. From the viewpoint of the Japanese

side, the capital backing by the world’s largest company in the industry has presented

a vision for further business progress.

1) Avnet Japan was formerly known as Okura Electronics Co., Ltd., a fully-owned subsidiary of

Okura & Co., Ltd. established in April 1983 to deal in semiconductors, electronic appliances and

information equipment. As Okura & Co., Ltd. assigned its stocks to Memec PLC, a trading

firm dealing in semiconductors, etc. in the UK, it was re-launched as a semiconductor trading

house under the umbrella of the Memec Group in April 1998.

2) It subsequently changed its company name to OEL K.K., and then to Memec Japan K.K. in

August 2000. It was again renamed Avnet Japan Co., Ltd. in October 2005, following the

merger of its parent company Memec Group Holdings Ltd. with Avnet, Inc. (USA). This gave

Avnet, Inc. (USA) the opportunity to expand into Japan.

3) The strategy adopted by Avnet, Inc. (USA) is to cover regions evenly to improve the

accessibility for customers. It had long been interested in entering the attractive Japanese

market.

4) Avnet Japan intends to implement services adapted to the region based on its roots in the

Japanese market.

34





1) The headquarters of customers and suppliers are concentrated in Tokyo.

2) The Company’s previous incarnations Okura Electronics Co., Ltd. and Memec Japan K.K. were

both based in Tokyo and their bases were taken over.





［Kansai Office］

In May 1993, Kansai office was established inside the Osaka branch of its parent company at the

time, Okura & Co., Ltd., to open a sales base for the Information Systems Department (sales items:

computer typesetting systems, customers: printing companies and newspaper companies).

For sales of semiconductors, trading accounts of Okura & Co., Ltd. were used. However, Kansai

office gradually increased directly-traded customer accounts to absorb the customer demand more

directly, partly in response to the recommendation by suppliers.

Kansai office was later relocated to Kitakyuhoji-machi as the Kansai sales base of OEL. It was

again relocated to the head office of Analog Semiconductor Inc. following its acquisition by Memec

Japan K.K. and became the current Kansai office.

［Nagoya Office］

Nagoya office was opened in July 1998, primarily for the purpose liquidating customer accounts of

the former parent company when it became part of the Memec Group. It was opened also to tackle

the extreme reluctance of customers especially in the Nagoya region to open accounts and deal with

any company that does not have a local office in the region.

Nagoya office does business mainly with such customers as Denso, Mitsubishi Nagoya and Hitachi

AE.

［Mitaka Office］

The head office of Analog Supply K.K.. was converted into Mitaka office following its acquisition.

In regards to its background, it was separated from the head office (Bunkyo Green Court) in

35

consideration of various circumstances to provide continual support to customers of the former

Analog Supply K.K.

［Alps Logistics Center］

Alps logistics center in Yokohama has been used since the days of OEL. During the Memec era,

the Company considered securing an owned-and-operated logistics center but determined that it

would be more cost-efficient to outsource logistics tasks to a third party based on cost comparison

results.

［Design Center］

The design center was established inside the head office for the purpose of deploying the latest

Xilinx product design tools and talented engineers and conducting technical training and seminars

periodically, not to mention providing design support to customers, in order to offer Xilinx

PLD/FPGA solutions—which are becoming more sophisticated year by year to customers—with

greater speed and precision.

As part of its strategy to differentiate itself from other semiconductor trading firms, it aims to

enhance technical support specializing in PLD/FPGA with high technical added value.


(i) Merits

1) The Company was able to utilize the relationship with suppliers that had already been

established to a certain degree and operational capabilities with extensive knowledge of the front

line—this was the case at all offices.

2) The Company did not have to start from scratch to invest in human resources, including

re-education of existing staff and recruitment of new staff, as there were already experienced

engineers and managers with deep knowledge of the market.

(ii) Demerits

It is taking more time than expected to integrate the two corporate cultures after the merger.



The Company will consider taking advantage of incentives, if there are any opportunities to do so.

However, the Company intends to expand its bases to meet customers’ requests rather than

expanding into regions for the sake of incentives.

36



1) The Company is planning to expand bases in line with sales. It is thinking about increasing its

bases in the future if customer demand exists, as a matter of course.

2) When Avnet, Inc. (USA) made inroads into the Japanese market, existing assets were utilized.

Neither enticement activities nor incentives will be the primal motives for opening bases, but the

Company will highly appreciate any useful information in the future. The Company would

like to consider making use of them especially if synergies, etc. could be expected in candidate

regions. However, as services and customers come first in its industry, the Company is

committed to focusing on customers’ needs.

3) The Company is currently developing an infrastructure that can be linked with the global

framework by making IT investments—more specifically, by introducing an Enterprise

Resource Planning (ERP) system. It hopes to further improve its services by such measures to

satisfy customers and suppliers.

4) For the time being, the Company intends to put efforts in the “Avnetization” (branding in

harmony with Avnet) of existing business resources, especially by deepening communication

in-house.

5) In principle, Avnet Japan is focused on running its business by adapting to the region, based on

its roots in the Japanese market. If one takes a broader perspective, the globalization trend is

gaining momentum in markets, so Avnet Japan hopes to further deepen inter-regional

communication and offer globalized services in the future.

37

7. Founder International Inc.

[Osaka Office]

(1) Company Profile

(i) Company Name: Founder International Inc.

(ii) Address: Ooimachi Center Building, 1-24-5 Ooi, Shinagawa-ku, Tokyo

140-0014, Japan

(iii) Shareholder: Founder Group, SoftBank Investment, etc.

(iv) URL: http://www.founder.co.jp/

(v) Representative: Representative Director Guan XiangHong

(vi) Paid-in Capital: ¥377.67 million

(vii) Established: March 1996

(viii) Performance: ¥1.67 billion (year ended December 31, 2005)

(ix) Number of Employees:500 employees (including subsidiaries)

(x) Places of Business: Osaka office (2004)

Overseas subsidiaries: Beijing (1999), Wuhan (2000), Toronto,

Canada (2000)

(xi) Business Activities: Development and sale of DTP software, development and sale of

database systems, provision of system solutions targeted at printing,

logistics, publishing and newspaper companies (development and

consulting of software and systems) and sale of Chinese fonts

(xii) Breakdown of Sales: Development and sale of software and system integration (100%)

Founder International Inc. is the Japanese subsidiary of the Founder Group, which is fully funded by

Beijing University. The Founder Group is the leader in China’s IT industry, and engages in

business mainly in the fields of printing, publishing, finance, media and ecommerce, including

packaged products and system integration. The Group has about 15,000 employees and generates

¥300 billion in sales (FY2004). It has 43 affiliates including those in China, and has

locally-incorporated subsidiaries in Japan, Hong Kong, Malaysia and South Korea. Its subsidiary

Founder Technology Group Corp. is well-known as China’s second largest computer manufacturer.



There were no particular enticement activities, incentives, etc. in Japan. The Group expanded into

Japan according to its corporate strategies.

38


1) The Founder Group, established in 1988, gained more than 90% of the market share in China’s

newspaper and publishing sectors in the early 1990s. As the multilingual Desktop Publishing

(DTP) software developed by its founder Professor Wang Xuan, a friend of Bill Gates, was

superb, there was a proposal to expand into Japan—another cultural sphere based on Chinese

characters—in the second stage of its overseas expansion following its entry into Hong Kong.

2) In the mid-1990s, China was more advanced than Japan in the DTP field. As Japanese

publishing and printing companies visited Beijing frequently, the Company determined that it

could make it in the Japanese market as well.

3) Professor Wang Xuan discovered that Guan XiangHong, who studied under him and graduated

Beijing University with top honors, was working in Japan, and recruited him to the position of

President. His fluency in Japanese substantially helped the business later.





In expanding the business, Tokyo was regarded as the optimal location because of its high

concentration of newspaper and publishing companies.



There were no particular invitation activities or incentives.


The Company established an office in Osaka two years ago because the frequency of long-term

business trips increased after accepting work from five/six companies in Osaka.


(i) Merits

1) The task of making inroads into Japan was aimed at strengthening the Founder Group based on

the tough quality standards in Japan to turn it into a world-class company, to prepare for its

global expansion in the future. The results have exceeded expectations.

2) Generally speaking, the approach taken by Chinese companies is to deliver the products first and

39

if any problems arise, deal with them and make the products easier to use for customers. The

Company gained a full understanding that such a haphazard approach to products would not be

tolerated in overseas markets.

3) President Guan says that it is more fun doing business in Japan than in China. This is probably

because in China, personal contacts and bribes still tend to count.

(ii) Demerits

There are no particular demerits.



There are no wishes or requests to local authorities, etc. regarding enticement activities, incentives,

etc.

Chinese companies have no problems as far as marketing and development capabilities are

concerned, but many of their personnel systems, accounting systems, contracts, etc. are not

applicable overseas. In order for Japan to attract Chinese companies in the future, it will be

necessary to provide support including dispatching a specialist to companies entering Japan.



(i) When the Company was first launched, the President was the only staff and he had to post a

“secretary wanted” advertisement at Nittyu Gakuin (http://www.rizhong.org/). “Founder” is

a famous brand among many people in China but is poorly recognized in Japan, so the

Company had a hard time not being able to compete with Fujitsu and other large companies in

terms of credibility.

(ii) In 1998, the Company was adopted by “Car Sensor”, a used-car magazine published by

Recruit Co., Ltd. This substantially helped business subsequently.

(iii) At the time, the layout of “Car Sensor” consisted of a huge number of photos of cars and

individual data which required extremely laborious editing tasks. Founder’s system made it

possible to edit “one volume per hour” on computers.

(iv) Nikkan Sports, which published nearly 200 printed titles of various types including sports

newspapers, was able to streamline the operation of the rotary press by using the optimal

printing system software proposed by the Company. Such accomplishments attracted

attention among other companies.

40

(v) Founder’s research institute in Toronto, Canada has talented engineers of Chinese origin, so it

is asked to undertake system development. Job orders received in Japan by research

institutes in Beijing and Wuhan are brought into the respective cities to be worked upon.

(vi) As the opening of the Beijing Olympics approaches, an increasing number of Japanese

companies are inquiring about expanding into China. Competition over the ticket vending

machine system for subways in Beijing was fierce, with the participation of Western and Asian

companies—yet Omron, which partnered with Founder, won the contract. In the case of a

map information system, even though there were major obstacles to Japanese companies due

to the fact that it related to military secrets, the joint venture between the Founder Group and

Shobunsha Publications, Inc. was given permission to run a map contents business in China.

This could not have been achieved without the personal connections and credibility of the

Founder Group, an enterprise funded by Beijing University.

(vii) There are no plans to open offices outside Osaka. The Company will sell its software, etc. by

using the sales networks of other companies. In the field of R&D, the Company is more

likely to resort to M&A rather than embarking on it by itself.

(viii) The Company plans to be listed on the Mothers section of the Tokyo Stock Exchange and the

Hercules section of the Osaka Securities Exchange in the next year or two, and is making

preparations for that purpose.

41

8. Continental Teves Corporation

[Head Office Relocation (Kanagawa Prefecture), R&D Center/Plant/Office (Chiba, Shizuoka

and Hiroshima Prefectures)]

(1) Company Profile

(i) Company Name: Continental Teves Corporation

(ii) Address: Technowave 100 Building 15F, 1-1-25 Shin-Urashima-cho,

Kanagawa-ku, Yokohama City, Kanagawa Prefecture 221-0031,

Japan

(iii) Shareholders: Continental AG (Germany) 51%, Nisshinbo Industries, Inc. 49%

(iv) URL: http://www.conti-online.com/generator/www/jp/jp/

continentalteves/continentalteves/general/home/index_jp.html

(v) Representative: Representative Director Peter Laier

(vi) Paid-in Capital: ¥5 billion

(vii) Established: December 2000

(viii) Performance: ¥68.4 billion in sales (year ended December 31, 2005)

(ix) Number of Employees:805 employees (in Japan as of January 31, 2006), 1,300 employees

in China

(x) Places of Business: R&D (development centers) = Yokohama head office (EBS/WSS),

Asahi City, Chiba Prefecture (EBS) and Higashi-Hiroshima City,

Hiroshima Prefecture (HBS)

Manufacturing Plants = Hamamatsu City, Shizuoka Prefecture

(EBS), Higashi-Hiroshima City, Hiroshima Prefecture (HBS) and

Lian Yun Gang, China (WSS)

Test Courses = Asahi City, Chiba Prefecture and Monbetsu City,

Hokkaido Prefecture

Sales Bases = Yokohama head office, Hamamatsu City, Shizuoka

Prefecture, Hiroshima City, Hiroshima Prefecture and Seoul, South

Korea

Affiliate = CTC Lian Yun Gang, China

(xi) Business Activities: Development, production and sale of Electronic Brake System

(EBS) and Hydraulic Brake System (HBS) of automobiles, Wheel

Speed Sensor (WSS) and peripheral parts and components of said

brakes in general. Research and development in view of

next-generation automobiles.

(xii) Breakdown of Sales: EBS, HBS and WSS (brake systems), etc. 100%

42



There were no particular enticement activities, incentives, etc. in Japan.


Continental Group of Germany consists of three segments. Continental Teves Corporation is a joint

venture company of Continental Teves AG, the world’s biggest supplier of brake systems, and

Nisshinbo Industries, Inc.

Nisshinbo Industries’ brakes division has a long history, having manufactured aircraft brakes during

World War II. Its Anti-lock Braking System (ABS) division and the Continental Group formed an

alliance on disc braking technology in 1982, on ABS technology in 1984 and on Traction Control

System (TCS) technology in 1990. They subsequently deepened their relationship by signing an

ABS/TCS cross-licensing agreement in 1993, an ABS/TCS marketing agreement in 1994 and a

technical collaboration agreement based on MK60 (ABS product name) in 1999. Consequently,

they established a joint venture company in Japan.

For the Continental Group, the Asian market is attractive in the context of its global strategies, and it

was important to increase dealings with Japanese automakers. Its manufacturing plant in

Hamamatsu City, Shizuoka Prefecture, the development center in Asahi City, Chiba Prefecture, etc.

use Nisshinbo Industries’ bases and facilities.



1) There were no particular invitation activities or incentives by the Tokyo Metropolitan

Government.


Initially, the Company was located in Nihonbashi-Hamacho, Tokyo but it became too small due to

the rapid growth in business. For this reason, the head office and part of the development center

was relocated to Yokohama City in November 2004.

(4) Background to and Reasons for Making Secondary Investments in the Region (Head Office

Relocation)


There were invitations from the Yokohama City Government. As the Frankfurt office of the

Yokohama City Government is situated in the headquarters of Continental Teves AG in Frankfurt,

Germany, there has been a long relationship with the Yokohama City Government and a wide range

43

of information has continually been exchanged between the two.

In Japan, the Business Development Division of the Economic Affairs Bureau of the Yokohama City

Government contacted the Company. In the process, the Company acknowledged that Yokohama

City would be a suitable development base.

It is important to have a trusting relationship based on communication with the local authorities.


The Yokohama City Government took very good care of the Company in selecting the site of the

head office in Yokohama City and in utilizing the subsidy scheme, etc. The Company plans to

consolidate its development bases in Yokohama to enhance its development capabilities.

There are many technical engineers in Yokohama, so it is easy to recruit necessary staff. Also, it is

easy for foreign companies to blend in, perhaps due to its historic background. Access to

customers is also good.

The Company expanded into Higashi-Hiroshima City in Hiroshima Prefecture through corporate

acquisition.


There have been no particular unexpected merits or demerits.



Continental Teves AG (Germany) is headquartered in Frankfurt, where the Frankfurt office of the

Yokohama City Government is also located. Mr. Hiroshi Nakata, Mayor of Yokohama City, has

visited the headquarters of Continental Teves AG. Based on such ties, the Business Development

Division of the Economic Affairs Bureau was extremely cooperative and supportive. The

Company is likely to receive its assistance in various ways in the future.



There are currently about 250 development staff as a whole. The Company plans to double the

number of development staff to 500 by 2010. Studies on sites are currently being conducted to

create bases for that purpose. However, such bases will be established by partner companies

(which cannot be disclosed at the moment) and will be rented by the Company.

As Japanese automakers decide the specifications of new cars to be sold in the global market, the

basic development policies and the selection of suppliers in Japan, it is necessary to have a

development base that can respond to them in a timely manner.

44

Ownership of a development base will complete the foundations of Continental Teves’ tri-polar

worldwide strategy, which is to have bases in Frankfurt in Germany, North America and Japan.

The plant in Lian Yun Gang, China (approx. 1,300 employees) is a Wheel Speed Sensor (WSS)

manufacturing plant acquired in January 2004. Continental Teves AG has a 51% stake and

Nisshinbo Industries has a 49% stake in the plant—the same ratio as in the Company.

45

9. Singapore Telecom Japan, Co., Ltd.

[Osaka Branch/Data Center]

(1) Company Profile

(i) Company Name: Singapore Telecom Japan Co., Ltd.

(ii) Address: Arco Tower 5F, 1-8-1 Shimomeguro, Meguro-ku, Tokyo 153-0064,

Japan

(iii) Shareholder: Singapore Telecommunications Limited (100%)

(iv) URL: http://business.singtel.com/singtel.jp/ (Japanese subsidiary’s

website)

(v) Representative: President & Representative Director Xie Cicai

(vi) Paid-in Capital: Undisclosed

(vii) Established: May 1998 (Japan liaison office was opened in June 1995)

(viii) Performance: Undisclosed. Parent company Singapore Telecommunications Ltd.

(established in 1879) has market capitalization of S$44 billion

(approx. ¥3.08 trillion), sales of S$12.6 billion (approx. ¥882 billion

in the year ended March 31, 2005) and approx. 19,000 employees in

the Group.

(ix) Number of Employees:Approx. 40 employees

(x) Places of Business: Network center (Shinagawa, 1999), network center no.2 (Shiohama,

2001), Osaka branch and data center (2001)

(xi) Business Activities: International data communications service (IP-VPN, FR, ATM,

international leased lines, IP-Sec, satellite), Internet data center

(collocation, Internet access service), voice service (international

calls, calling cards, video conferencing services, audio conferencing

services, call center services, mobile phone rental services,

wholesale voice services, Internet gateway services)




There were no particular enticement activities, incentives, etc. in Japan.


1) Parent company Singapore Telecommunications Ltd. (SingTel), which has a 100% stake in

Singapore Telecom Japan Co., Ltd. (SingTel Japan), aims to become the No.1 general

46

communication carrier in Asia including Australia. It had sales bases and facilities in Europe

and the United States until about ten years ago, but has now completely withdrawn from those

countries and is currently concentrating on Asia. Its major investments in communication

carriers in the Asia-Pacific region include Optus in Australia (100% stake), Advanced Info

Service in Thailand (21.4% stake), APT Satellite in Hong Kong (20.3% stake), Bharti Telecom

in India (30.7% stake), Globe Telecom in the Philippines (44.7% stake), New Century

Infocomm in Taiwan (24.5% stake), Pacific Bangladesh Telecom Limited in Bangladesh (45%

stake) and Telkomse in Indonesia (35% stake).

2) After SingTel’s expansion into Japan in the mid-1990s, the economy experienced prolonged

recession following the collapse of the bubble. The communications sector, however, faced a

major turning point due to the rapid progress in technological innovation, the explosive growth

of the Internet, the spread of IP phones, and the progress in the installation of optical submarine

cables connecting the world. Communication carriers in the United States and Europe made

inroads into Japan one after the other.

In the Asian communications market, Japanese companies are the biggest in terms of the number

of customers. This was SingTel’s target when it expanded into Japan. As SingTel owns

wide-ranging submarine cable networks, communication satellite systems including ST-1 and

large-scale Internet exchanges (IX) by itself, it can provide diverse solutions and network

services of high quality and reliability.





The Tokyo Metropolitan Area accounts for 80% of the entire communications market. It also

accounts for more than 80% of SingTel Japan’s main services and international data communications

in terms of both number of customers and sales. Naturally, SingTel Japan is headquartered in

Tokyo.

In May 2004, the head office was relocated to the current location, which is a large building with

good transport accessibility and a nice surrounding environment.



There were no particular invitation activities or incentives.

47


The next step was to move into Osaka in consideration of its market size. When establishing the

data center in Osaka, the Company was keenly approached by Shima-cho, Mie Prefecture (which

became Shima City in October 2004 through amalgamation), but it ultimately chose Osaka

considering the location relative to customers, the need to secure personnel, etc.

As a result, the Company was able to find good university-educated, talented individuals. The

merit is that it is generally easy to hire staff.


There are no particular unexpected merits or demerits.



The Company believes various seminars on overseas networks, domestic and overseas capital

investment, etc. should be actively organized by JETRO or jointly organized with local authorities.

The Company would like to gather information through such seminars in regards to what kind of

services it could receive from JETRO and local authorities.



If the Company were to increase its bases in Japan (data centers) in the future, the next place would

be Nagoya. This would link the Tokaido. However, it is more likely that additional investments

will be made in Tokyo. In the field of international communications, the over-concentration in

Tokyo is pronounced. Even if a company is headquartered in Hokkaido or Fukuoka, international

communications are handled by the Tokyo branch in many cases.

Firstly, measures should be taken as a matter of national policy to disperse companies and their

functions to rural areas. In Tokyo, costs are high in all aspects. If the locations and functions of

manufacturers are dispersed, communication carriers will naturally follow them.

48

10. Nihon Weidmuller Co., Ltd.

[Chubu Branch]

(1) Company Profile

(i) Company Name: Nihon Weidmuller Co., Ltd.

(ii) Address: Asahiseimei-Fuchu Building, 1-14-1 Fuchu City, Tokyo 183-0055,

Japan

(iii) Shareholder: Weidmuller Holding AG & Co, KgaA (Germany)

(iv) URL: http://www.weidmuller.co.jp/

(v) Representative: President & Representative Director Fusao Sawachika


(vii) Established: March 1980 (viii) Performance: Nihon Weidmuller Co., Ltd. is a consolidated subsidiary of

Weidmuller Holding AG & Co, KgaA (Germany) headquartered in Detmold, Germany but non-consolidated financial results are undisclosed. Weidmuller Holding AG & Co, KgaA (Germany) has 2,300 employees, 29 branches and locally-incorporated subsidiaries overseas, a plant in Detmold, Germany and Suzhou, China. Its sales amounted to €326 million (approx. ¥44 billion) in 2004.

(ix) Number of Employees:Approx. 20 employees

(x) Places of Business: Chubu branch (Nagoya City, Aichi Prefecture, in operation since January 2006), West Japan branch (Osaka City, Osaka Prefecture, 1981), plant (Hiki-gun, Saitama Prefecture, 1984)

(xi) Business Activities: Nihon Weidmuller Co., Ltd. manufactures and sells terminal blocks, connectors, interface modules, protective components, relay sockets and other electronic and electric components and equipment used in industrial machinery and devices. It also manufactures and sells a wide range of tools, in addition to electric facilities, marking materials and basic (I/O) components.

Other than the above, it runs an OEM business which involves

providing product solutions according to specific customers’

requests. (xii) Breakdown of Sales: Electric components (terminal blocks, terminal boxes, connectors,

etc.) 100%

Weidmuller products are mainly used in switch cabinets and on-site wiring work. It has 29

overseas subsidiaries and operates around the world in the fields of industrial technology, processing

technology, transport technology, etc., in addition to its special technology in the field of

manufacturing precision mechanisms.

49

Weidmuller Group consists of production facilities, distributors and agents spreading across more

than 70 countries and is aggressively pursuing international operations. It is recognized by

customers around the world as a partner with a high standard of quality and service and advanced

capabilities and flexibility.

Nihon Weidmuller Co., Ltd. was established as a sales subsidiary of Weidmuller Holding AG & Co,

KgaA (Germany) in 1980, and embarked not only on sales but also on production by constructing a

new plant in Hiki-gun, Saitama Prefecture as the first production base in the Asian market and

launching full-scale operations in 1984.



No response due to lack of records of what happened when the Company expanded into Japan.










There was no particular invitation by the Nagoya City Government, but the Company is currently

applying for subsidies from the Nagoya City Government as incentives.


The Company used to have an office in Nagoya City but closed it as part of restructuring in 2003.

The vacuum left after its closure was filled by the support by West Japan branch in Osaka, but the

Company decided to open a branch in order to improve the level of customer satisfaction among

existing clients and to actively tap new customers.


(i) Due to the shortfall in human resources, it was extremely difficult to recruit staff in Nagoya.

50

However, the Company was able to acquire valuable staff needed to open the branch as JETRO

introduced a local recruiting agency.

(ii) The Company is currently applying for Nagoya City Government’s subsidies based on referral

from JETRO. It is expected to serve as considerable financial assistance for opening the

branch (as of March 20, 2006).

(iii) After recruiting staff for launching the branch, the Company immediately moved into an

incubation room of JETRO’s Invest Japan Business Support Center (IBSC) in January 2006 and

was able to commence operations smoothly. The Company was also able to find a permanent

new address while executing daily operations, having had an adequate real estate agent

introduced by JETRO.



There is none in particular. The Company is satisfied with and extremely grateful for the support

given by JETRO and the local authorities.



The Company will first aim at yielding good results at the existing three bases (Tokyo, Osaka and

Nagoya). In the future, it hopes to have bases in Kyushu and Chugoku regions. It used to have

bases in Hiroshima City and Nagasaki City. The Company will expand its operations into regions

where it used to have bases because it is presumed that there is big potential demand in those

regions.

[Reference] JETRO’s Invest Japan Business Support Center (IBSC)

At JETRO’s Invest Japan Business Support Center (IBSC) in six regions in Japan, experienced

dedicated staff and experts provide a wide range of information relating to investment in Japan to

foreign companies considering making an investment in Japan or launching a business in Japan

through their broad networks spanning public and private sectors, and provide consultation services

tailored to individual companies.

(1) Free Provision of Office Space

IBSC offers individual offices which are available for use free of charge to foreign companies that

are considering expanding into and running a business in the Japanese market. Each office is

51

equipped with facilities needed to launch business activities immediately in Japan, such as phones

and facsimiles connected to separate lines and broadband Internet access.

(2) Consultation relating to Japanese Market

At IBSC, dedicated staff and market experts give advice on the market structure, system, etc. by

industry free of charge. IBSC also serves as a one-stop resource of information on administrative

procedures and regulations applicable when a foreign company enters the Japanese market.

(3) Support in Incorporation Procedures

At IBSC, experts in company/branch registration, visa, tax affairs, labor affairs, etc. give advice on

various procedures for establishing a company, etc. free of charge.

(3) Referral of Support Organizations and Arrangement of Property Inspection

When establishing a base in Japan, IBSC introduces procedure agents, personnel placement agencies,

real estate agents and other organizations which help establish the base. It also makes

arrangements for collection of property-related information and inspection of properties in each

region as well as interviews with local authorities by using its network of local authorities.

52

[IBSC in Various Regions (http://www.jetro.go.jp/invest/services/ibsc/locations/)]

Address TEL FAX

Tokyo Ark Mori Building 7F, 1-12-32, Akasaka,

Minato-ku, Tokyo 107-6006

+81-3-3582-4685 +81-3-3584-6024

Yokohama Industry & Trade Center Bldg. 9F,

Yamashita-cho 2-banchi, Naka-ku,

Yokohama City, Kanagawa Prefecture

231-0023

+81-45-222-8911 +81-45-662-4980

Nagoya Nagoya Center Bldg. Annex 8F, 2-2-22

Nishiki, Naka-ku, Nagoya City, Aichi

Prefecture 460-0003

+81-52-222-4711 +81-52-222-4750

Osaka Nakanoshima Mitsui Bldg. 5F, 3-3-3

Nakanoshima, Kita-ku, Osaka City

530-0005

+81-6-6447-2309 +81-6-6447-2329

Kobe Kobe C.I.T. Center Bldg. 4F, 5-1-14

Hamabedori, Chuo-ku, Kobe City

651-6591

+81-78-252-7505 +81-78-252-7506

Fukuoka Elgala 7F, 1-4-2 Tenjin, Chuo-ku,

Fukuoka City, Fukuoka Prefecture

810-0001

+81-92-735-4224

+81-92-714-0709

53

Marc

Invest Japan Department, Japan External Tr

ARK MORI BUILDING 6F 12-32 AKASA

Tokyo 107-6006 Japan

Telephone：+81- (0)3-3582-5234 URL：

(Notice for U.S. Users Only) This material iYork, San Francisco, Los Angeles, Chicagoregistered under the Foreign Agents RegistrTrade Organization, Tokyo, Japan. This matJustice where the required registration statemRegistration does not indicate approval of States Government.

h, 2006

ade Organization（JETRO）

KA 1-Chome, Minato-ku,

http://www.investjapan.org/

Copyright: ©JETRO 2005

s disseminated by the JETRO offices (New , Houston and Atlanta), which are all ation Act as agents of the Japan External erial is filed with the U.S. Department of ent is available for public inspection.

the contents of the material by the United

Survey on Successful Cases of Secondary Investments by ... · led by the Semiconductor Group in...

Documents

Transcript of Survey on Successful Cases of Secondary Investments by ... · led by the Semiconductor Group in...