The pair have signed a letter of intent regarding the “possible set-up of a joint venture company in [the] future specifically aiming at improving [the] competitiveness of sheetfed offset printing machinery”.
ProPrint‘s sister title, PrintWeek, understands that talks have been going on for some time and have now reached the stage where the two Japanese manufacturers have decided to formalise the process. According to the letter of intent, the deadline for a final agreement is 30 June.
This will establish the terms of any joint venture, including “significant synergy effects such as enhancement of product line-up, enlargement of product development capability, reduction of product cost, and improvement in sales and service networks”.
“The plan is expected to enable [a] stronger presence in the global market,” said the statement.
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Ryobi’s local distributor, Cyber, was reluctant to speculate about what a business alliance would mean for Australia and New Zealand.
However, managing director Bernard Cheong told ProPrint the forecast synergies suggested “more solutions being made available from Ryobi through Cyber in the near future”.
According to an overview issued with the letter of intent, Mitsubishi’s Paper & Packaging Machinery division had net sales of ¥43.6 billion ($465 million) for the year ended 31 March 2012 and an operating income of ¥1.8 billion.
Ryobi’s net sales for the same period came in at ¥165.6 billion, with an operating income of ¥7.7 billion, although these figures cover the whole group, including sales from power tools, builders’ hardware and die-cast products.
According to Ryobi’s website, its printing equipment revenue has declined from ¥41 billion in 2007-08 to ¥17.5 billion in 2011-12. Its forecast revenue for the year ended 31 March 2013 is ¥15.2 billion.
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This article originally appeared at printweek.com
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