ITOCHU Makes Leilian Consolidated Subsidiary
December 25, 2009
ITOCHU Corporation (headquartered at 5-1, Kita-Aoyama 2-chome, Minato-ku, Tokyo; President: Eizo KOBAYASHI) announces that it has signed today an agreement to acquire 52.8% of the outstanding voting shares of Leilian Co., Ltd. (hereinafter “Leilian”), a women’s apparel company from Renown Co., Ltd. (hereinafter “Renown”). Leilian is achieving strong growth with its major strengths in product development and customer management in the women’s apparel segment, focusing principally on married women. ITOCHU will acquire shares from other existing shareholders of Leilian, which will then become a consolidated subsidiary of ITOCHU. Following the acquisition, the ITOCHU Group will seek to maximize synergies with Leilian.
With the acquisition, ITOCHU will take steps to bolster the corporate value of Leilian by streamlining the product procurement and logistics capacities, tapping the ITOCHU Group’s global capabilities in these areas, and proposing garment material with high added value. ITOCHU will also seek to inject new vigor into its apparel OEM business through the management of Leilian, which excels in customer management, developing businesses for China and other overseas markets, in addition to domestic production areas and markets.
The transfer of management rights to Leilian from Renown to ITOCHU is a reflection of the long and very positive business ties and the close relationship of trust between ITOCHU and Renown. The two companies are also planning to form an alliance to further enhance their business relationship. Through supplementary functions, the companies will work to heighten their corporate values and develop the apparel industry.
Manufacturing in the apparel industry has advanced to inland China, a major production area, as well as other Asian countries. It is expected to become more diversified and complex, given growing demand for speedy product procurement in anticipation of retail sales trends.
Recognizing these changes, IOCHU has strengthened its management bases and alliances with outstanding companies that have strong ties with their customers, both in Japan and overseas. Specifically, ITOCHU made Sankei Co., Ltd., a leader in the garment accessories industry, a subsidiary in October 2008, and took a 28% stake in Shanshan Group Co., Ltd. in February 2009. ITOCHU also acquired a 25% stake in Watakyu Seimoa Corporation, the dominant provider in the Health Care & Welfare Services Industry, in September 2009, and took a majority holding in Java Holdings Co., Ltd., a women’s apparel companies group in November 2009.
Through these initiatives, ITOCHU will seek to establish a platform in significant areas and regions of the textile industry, aiming to continue its development by consistently and reliably providing customers with superior products and services.
|Company Name||Leilian Co., Ltd.|
|Representative||Masuo Minato, President and Chief Executive Officer|
|Headquarters||5-39-20 Seta, Setagaya-ku, Tokyo|
|Capital||600 million yen|
|Number of Employees||1804 (Male: 77 Female: 1727) as of December 31, 2008|
|Sales||56.4 billion yen (for the fiscal period ending December 2008)|