ITOCHU Announces Capital/Business Partnership with Teraoka Seisakusho Co., Ltd.

March 2, 2012

ITOCHU Corporation (headquartered in Minato-ku, Tokyo; Masahiro Okafuji, President & CEO; hereinafter “ITOCHU”) announced today that it agreed with adhesive tape major Teraoka Seisakusho Co., Ltd. (Listed on TSE Div. 2; headquartered in Shinagawa-ku, Tokyo; Keishiro Teraoka, President and Representative Director; hereinafter “Teraoka Seisakusho”) to sign a capital/business partnership and acquire all shares that the company will issue additionally through private placement. After acquiring the additional shares, ITOCHU will own 25.00% of Teraoka Seisakusho’s issued stock (25.35% ownership of voting share), placing the company as an equity-method associated company of ITOCHU.
This private placement is under the condition that it will be approved at Teraoka Seisakusho’s extraordinary general meeting of shareholders scheduled for March 29, 2012.

Teraoka Seisakusho is an adhesive tape manufacturer with a long history, founded in 1921 and producing a wide variety of products ranging from its founding business of packaging tape to electrical/electronics tape and industrial tape.
With the recent proliferation of cellphones, smartphones and mobile PCs, national and international demand for electrical/electronics tape is increasing in the adhesive tape industry. The global market for adhesive tape and film for electrical and electronics fields is projected to expand in scale from 670 billion yen in 2010 to over 800 billion yen in 2014, particularly owing to demand from the Asia region, and is a growing market garnering high expectations.
Under these circumstances, Teraoka Seisakusho has led the strategy of expanding its product base of electrical/electronics tape and other value-added products. The company currently maintains a top position within the industry in conductive and masking tapes for electronic parts. In March 2011, it established a local corporation in Indonesia that will assume integrated production, and is currently preparing to start operation in June 2012. Realizing the importance of developing a system of global collaboration with a reliable partner in terms of marketing, material procurement and logistics in order to take full advantage of such production facilities and expand business on a global level, Teraoka Seisakusho decided to consider a strategic partnership with ITOCHU, with which it has developed a trusting relationship and continued to transact with primarily in supplying raw materials for its adhesive tapes.

ITOCHU, too, had considered a capital partnership with Teraoka Seisakusho based on the awareness that by utilizing Teraoka Seisakusho’s technology and production facilities it would strengthen trade with major clients and offer more diverse product choices in the globally growing fields of medical supplies and electronics, while allowing the entire ITOCHU Group to expand its business to more diverse domains such as developing strategic products for new usage.

Seeing the match between such interests of the two companies, we reached the latest decision for ITOCHU to acquire capital in Teraoka Seisakusho and develop a fully cooperative system that includes the dispatching of human resources.

ITOCHU and Teraoka Seisakusho will use this capital/business partnership to further strengthen their relationship for enhancing their existing businesses and driving the creation of businesses in new fields, taking advantage of ITOCHU’s group network.

Teraoka Seisakusho Co., Ltd. Company Profile

Name Teraoka Seisakusho Co., Ltd.
Head office 1-4-22 Hiromachi, Shinagawa-ku, Tokyo
Representative Keishiro Teraoka (President and Representative Director)
Founded February 1921
Incorporated May 1943
Capital 3,904,380,000 yen
Employees 599 (as of March 31, 2011)
Business Manufacturing, processing and sales of various adhesive tapes
Sales 23.1 billion yen (for fiscal year ended March 2011)