Kokuyo Buys 37.45% Of Pentel For $92 Million

[Drone]

Sometime around 11-May-2019 Kokuyo indirectly purchased a 37.45% stake in Pentel for $92 Million USD. This is an odd tie-up as it seems like it is some sort of cooperative arrangement, not consolidation. Normally you would think of Kokuyo and Pentel as face to face competitors. More below excerpted from the referenced articles, which I suggest you read.

Kokuyo only makes about 20% of its stationery-related sales overseas, while Pentel generates over 60% of its revenue abroad through roughly 20 foreign sites. The companies' products are also complementary, given Kokuyo's strength in notebooks and Pentel's know-how in writing instruments. Pentel booked sales of 40.9 billion yen in the year ended March 2018. Kokuyo has sales of 315.1 billion yen.[1]

Kokuyo said that “there is a business environment in which it is essential for companies with solid strengths to build alliances with each other and create new value to continuously improve corporate value in the global stationary domain.”[2]

References:

1. Japanese stationery sharpens global push with Kokuyo-Pentel tie-up

https://asia.nikkei.com/Business/Companies/Japanese-stationery-sharpens-global-push-with-Kokuyo-Pentel-tie-up

2. Kokuyo invests in Pentel

http://office-times.com/News/11676/kokuyo_invests_in_pentel

[Algester]

hmm from the way I see it they technically arent in a competition Kokuyo is more of an Office (they do office tables and chairs) and Paper solution while Pentel is more of a Pen and Stationery solution

 

but mmm let's see where this investment leads

[Drone]

hmm from the way I see it they technically arent in a competition Kokuyo is more of an Office (they do office tables and chairs) and Paper solution while Pentel is more of a Pen and Stationery solution

 

but mmm let's see where this investment leads

 

Hmmm... Makes sense. So probably Kokuyo is buying the Pentel pen making technology? In the USA when a situation like that comes up it often ends up with one company buying out the other company entirely. That gives the buyer what it needs while eliminating a source of competition at the same time. But it doesn't always work that way. A Brand has value too, so there's a cost in killing it. Sometimes it's better to let the brand live and just control it. In this case at 37.45% Kokuyo doesn't have a controlling interest in Pentel.

Edited May 22, 2019 by Drone

[rudyhou]

interesting news. thank you for the share.

[KyleClapton]

 

Hmmm... Makes sense. So probably Kokuyo is buying the Pentel pen making technology? In the USA when a situation like that comes up it often ends up with one company buying out the other company entirely. That gives the buyer what it needs while eliminating a source of competition at the same time. But it doesn't always work that way. A Brand has value too, so there's a cost in killing it. Sometimes it's better to let the brand live and just control it. In this case at 37.45% Kokuyo doesn't have a controlling interest in Pentel.

 

According to Nikkei, Kokuyo is the top shareholder of Pentel after taking 37% of Pentel. Maybe being top shareholder is already giving them enough control

[KyleClapton]

Sometime around 11-May-2019 Kokuyo indirectly purchased a 37.45% stake in Pentel for $92 Million USD. This is an odd tie-up as it seems like it is some sort of cooperative arrangement, not consolidation. Normally you would think of Kokuyo and Pentel as face to face competitors. More below excerpted from the referenced articles, which I suggest you read.

I forgot to thank you for interesting news. I am really out-of-date so until now June 12 I just know the news by your post

[Mech-for-i]

Made sense for both of them ... from both product portfolio and market penetration POV, as well as forging solution based chain of prospective future products ..