MINEBEA MITSUMI (the “Company”) hereby announces that MITSUMI ELECTRIC (“MITSUMI”), a subsidiary of the Company entered into an agreement with OMRON (“OMRON”) on June 30, 2021 for the acquisition (the “Business Acquisition) of the semiconductor and MEMS*1 fabrication plant and its MEMS product development function in OMRON’s Yasu facility (the “Subject Business”) through MITSUMI, as described below.
*1 Micro Electro Mechanical Systems
1. Reason for the Business Acquisition
The Company’s basic strategy is to identify the products as its core business called the “Eight Spears” in which the Company can demonstrate its strength, such as ultra-precision processing technologies and mass production technologies, and which would not be easily eliminated from the market and to provide the customers with new values by combining and integrating such products. Because analog semiconductors, one of the “Eight Spears”, are important components as a gateway to IoT technologies, which is a business area that the Company is focusing on, the Company intends to further expand its analog semiconductor business by enhancing its product portfolio and entering new application markets. Also, as the Company advocates a new strategy of QCDESS (Quality, Cost, Delivery, Eco / Efficiency, Service, Speed) to differentiate itself in eco-efficiency, energy saving design for analogue semi-conductors plays a crucial role in significantly reducing electricity consumption.
The Company’s semiconductor product supply includes power management ICs, timer ICs, MEMS sensors, magnetic sensors, automotive memories, and IGBTs*2 for consumer products, automotive applications, medical devices etc. The Company is especially proud of its approximately 80% global market share*3 of lithium ion battery protection ICs (one cell) used in smartphones and other products. Currently, in addition to realizing the synergies between MITSUMI and ABLIC Inc. (“ABLIC”) which was integrated in April 2020, through enhancement of the R&D function and expansion of the production scale mainly in pre-process, the Company aims to further expand the business size and increase the business value, achieving growth in sales from the current 60 billion yen level to 100 billion yen within several years and even toward 200 billion yen within ten years with help of M&A.
In terms of the production aspect of measures for growth above, MITSUMI and ABLIC of the Company’s analogue semiconductor business each has two plants for pre-process and post-process inside and outside of Japan. However, there has been a need to eliminate the shortage of production capacity in pre-process and to realize product strategies (IGBT expansion, measures for automotive products, miniaturization) while maintaining competitiveness through vertical integration, and therefore we aimed to acquire an 8 inch pre-process plant. Furthermore, the acquisition of such a plant has become an urgent issue because of the acceleration of the production capacity shortage due to a recent increase in demand for semiconductors.
Though the semiconductor / MEMS plant of the Subject Business currently mainly manufactures MEMS products, it has the 8 inch semiconductor pre-process capable of manufacturing analogue ICs, which will contribute to the Company’s target of production capacity enhancement in terms of process, proprietary technologies, size, operators’ skills etc. With the Business Acquisition, the Company will be able to obtain the 8 inch production base, which is necessary to strengthen the competitiveness of the Company’s semiconductor business in the future, and secure the realization of the analogue semiconductor business’s growth target even more.
After the Business Acquisition, the Company will build a production system for approximately 20 thousand 8-inch wafers per month at the plant by investing more than 10 billion yen as a first step for capacity increase. Thereafter, as there is further room for expansion at the plant, we intend to increase its capacity in accordance with demand etc. In this manner, we will build up a new core plant for MinebeaMitsumi Group’s pre-process and contribute to the strengthening of the domestic supply chain for analogue semiconductors as well.
In addition, the Subject Business has a wide range of design technologies and peripheral technologies for MEMS products. By combining these technologies and the Company’s MEMS sensor product technologies, we can expect such synergies as stronger lineup through new product development, higher performance of existing products, additional functions etc. In particular, as both the Subject Business and the Company have strength in the field of MEMS pressure sensors for blood pressure monitors, we will strengthen its competitiveness as a new niche top product. The acquisition of the MEMS sensor business will lead to the strengthening of the Sensor business, which is one of the Eight Spears strategy.
- *2 Insulated Gate Bipolar Transistor, a type of power semiconductor device
- *3 According to the Company’s research
2. Outline of the transferring company
Company name: OMRON Corporation
Title and name of Representative: Yoshihito Yamada, President and CEO
Date of establishment:May 19, 1948
Location: Shiokoji Horikawa, Shimogyo-ku, Kyoto-shi, Kyoto, Japan
3. Outline of the acquiring company
name: MITSUMI ELECTRIC
Title and name of Representative:Ryozo Iwaya, Representative Director, President and Chief Executive Officer
Date of establishment: January, 1954, (registered on April 16, 1949)
Location: 2-11-2 Tsurumaki, Tama-shi, Tokyo, Japan
4. Outline of the acquiring company’s parent company
Company name: MINEBEA MITSUMI
Title and name of Representative: Yoshihisa Kainuma, Representative Director, Chairman & President (CEO & COO)
Date of establishment: July 16, 1951
Location: 4106-73 Oaza Miyota, Miyota-machi, Kitasaku-gun, Nagano, Japan
5. Structure of the Business Acquisition
OMRON will establish a new company which succeeds the Subject Business by way of company split, all the shares of which new company MITSUMI will acquire.
6. Impact on business performance
Impact on the Company’s business performance is minimum.
Implementation date of the Business Acquisition: Expected to be October 1, 2021