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Nippon Sheet Glass: BRIC focus after Pilkington acquisition

Nippon Sheet Glass Co. intends to focus on strengthening operations in China and other emerging nations when it has completed the acquisition of Pilkington plc, Chairman Yozo Izuhara told The Nihon Ke…

Nippon Sheet Glass Co. intends to focus on strengthening operations in China and other emerging nations when it has completed the acquisition of Pilkington plc, Chairman Yozo Izuhara told The Nihon Keizai Shimbun on 7 March 2006. Acquiring Pilkington, the world“s third-largest flat glass maker, will expand the overseas production base of NSG from two factories in Southeast Asia to 28 worldwide, including in Europe, North America and China. After completion of the deal, Nippon Sheet Glass aims to concentrate its energies on the so-called BRICs markets, consisting of Brazil, Russia, India and China. “We want to tap demand from the local units of Japanese carmakers, as well as meet demand in local construction markets,” the chairman said. China is “a highly promising market, with car production there forecast to catch up with that in Japan in around 2010,” he added. Nippon Sheet Glass plans to transfer advanced technologies such as infrared blocking and glass forming to Pilkington“s factories and gradually replace exports from Japan with local output. There is stiff competition in the US market, with a number of flat glass suppliers doing battle, Izuhara said. The company“s focus there will be to quickly improve its production efficiency and product quality. Nippon Sheet Glass plans to set up the business integration headquarters in London and spend a year or so to consider various options, including a merger between Nippon Sheet Glass and Pilkington. With the acquisition expected to triple Nippon Sheet Glass“ group sales to about JPY 760 billion, the firm “is examining measures to protect itself from hostile takeover attempts”, Izuhara said. Addressing investor concerns over the JPY 616 billion cost of the acquisition, the chairman said that Nippon Sheet Glass“ new borrowings will actually come to around JPY 45 billion.

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