M&A

Japan’s Oji completes acquisition of Finnish film and packaging producer Walki

Japanese paper and packaging group Oji Holdings Corp completed the acquisition of Finnish film and packaging producer Walki Holding Oy in mid April 2024. Walki was owned by One Equity Partners since 2018. It has 17 production facilities in Finland, Germany, Belgium, Spain, France, Poland, the UK, and China and employs more than 1,700 people.

Oji owns two other European subsidiaries – Kanzan Spezialpapiere in Düren, Germany – with around 300 employees, and the Italian manufacturer of packaging and filling machines, IPI, which it acquired in 2023.

Oji Holdings Corporation was ranked as the sixth world’s largest paper & pulp company in 2022 and has nearly 38,000 employees, 156 subsidiaries worldwide, 86 manufacturing sites throughout Japan, forestry operations in Australia, Brazil, Canada, China, Germany, New Zealand and other countries around the world. Oji Holdings Corporation is listed at the Tokyo Stock Exchange with a market capitalization of approximately US$4bn.

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Largest Japanese companies in the UK – 2023

We’ve decided to stop trying to compile the Top 30 largest Japanese employers in the UK by corporate grouping. Partly this is because a substantial number of Japanese companies in the UK have become branches, so do not report their employee totals to Companies House. Another reason is that corporate groups have restructured substantially through divestment, so there are more subsidiaries which are equity affiliates rather than part of the consolidated company group, or are owned by KKR Japan (does this make them Japanese or not?). Finally, many of the largest Japan-owned companies were acquired through acquisition, but are not particularly “Japanese” in terms of their branding or executives.

Instead, we thought we’d look at the largest single Japan-owned companies – and it turns out that there are 31 who have over 1,000 employees. The full list can be downloaded  the link below.

The new entrant into this Top 31 in 2023 was Snowfox, a food processing company acquired by Zensho. Snowfox owns Taiko, who make sushi for Waitrose and Sainsburys and also owns the YO! Sushi restaurant chain, as well as chains in the USA and Canada.

In terms of growth, we already covered the fact that some of Dentsu UK’s and Dentsu International’s growth was due to the consolidation into Dentsu UK of its regional subsidiaries in Leeds, Edinburgh and Manchester, but there does also seem to be organic growth, and growth by acquisition too. The other companies showing double digit growth are mostly in the services sector – Yusen Logistics, Mitsubishi HC Capital and NTT Data. Only one manufacturer is showing double digit growth – Fujifilm Diosynth Biotechnologies – a contract development and manufacturing organisation in Teesside.

The automotive sector has shrunk further –  Nissan, Marelli (formerly Calsonic Kansei) and Honda Motor Europe had smaller workforces in 2023 than in 2022. Toyota has yet to file its accounts for 2023.

At risk of shrinkage or closure in the years to come look to be Hitachi Rail, whose contracts being built at its Newton Aycliffe plant come to an end in 2024 and Fujitsu, who has told staff that they will run down their Ireland operations, taking on no new contracts. This could be a pilot for what is to come in the UK.

Click here for download of the largest Japanese companies in the UK 2023

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Germany’s AEQUITA acquires German subsidiary of Japan’s Nifco

AEQUITA has added another Japanese company to its collection, following its acquisition of Nisshinbo’s TMD Friction last year.  It will acquire the German subsidiary of Nifco, which was itself a German company KTW, acquired by Nifco in 2014. Nifco Germany develops and produces injection-molded plastic components for the automotive industry, with around 766 employees in Germany, as well as operations in the USA and Serbia.

We assume this acquisition does not impact Nifco UK (which was Elta Plastics, acquired in 1990) or Nifco Poland, which we believe to be a greenfield investment. Nifco had already sold its Spanish subsidiary to Grupo Taurus in 2022.

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Mitsubishi Pencil acquires German pen maker Lamy

Mitsubishi Pencil has acquired the Germany company, C. Josef Lamy GmbH. Mitsubishi Pencil say they made the acquisition in order to expand overseas and move into higher price ranges, as the stationery market in Japan is expected to shrink amid the country’s falling birth rate and digitalization efforts.

Mitsubishi Pencil was already present in Europe – with headquarters in France and operations in the UK and Spain, employing around 100 people in total – they are most well known for their uni-ball rollerball pens. Lamy has around 380 employees.

Another area of collaboration is likely to be digital writing technology.

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Yusen Logistics acquires UK Enterprise Carrier Management company Global Freight Solutions

Yusen Logistics, part of the NYK Group, has acquired Noel Topco, which in turn owns Global Freight Solutions, via its subsidiary International Logistics Group. Yusen Logistics acquired ILG in 2018 bringing in omnichannel fulfilment solutions for e-commerce brands, with operations in 13 bespoke facilities in the UK and EU. GFS adds to this “advanced multi-carrier ECM technology, including higher checkout conversion, reduced cart abandonment and increased repeat-purchase.”

The NYK Group of companies in the UK now employ over 2,500 people, of which Yusen Logistics UK is the largest employer – the 14th biggest Japan owned company in the UK by our estimates, with 1,692 employees. ILG has 479 employees and Noel Topco 156.

Yusen Logistics sees this acquisition as part of their strategy to differentiate themselves from other companies by adding new platform services. “Our group aims to further grow our logistics business by building a solid business foundation in the e-commerce market, which is expected to continue expanding.”

UPDATE – in presumably related news, Yusen Logistics has announced it is investing £280m to acquire a new net zero warehouse in Northampton from real estate company SEGRO group, scheduled to open in April 2025.

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Daikin acquires Robert Heath Heating

Daikin Industries has acquired British company Robert Heath Heating, which handles the installation and maintenance of residential heating systems. In Europe, Daikin is focusing on heat pump heating, which has high energy-saving performance. The company will expand its installation and after-sales service network in the UK in anticipation of a growing shift from combustion heating systems that use gas and other sources. Robert Heath employs around 255 (June 2023 – Companies House) to 450 (according to Daikin) people in the UK.

The heat pump market has been rapidly expanding in recent years as countries have provided subsidies against the backdrop of rising awareness of decarbonization and the demand for energy that is not reliant on Russia. Although there was a decline in 2023 compared to the previous year due to falling gas prices and reductions in subsidies, Daikin’s Chairman Inoue Noriyuki said that “this remains a promising market that is expected to grow significantly over the medium to long term.”

One of the other issues for heat pump installation has been a shortage of skilled labour – we wonder whether Daikin hasn’t also acquired Robert Heath as a way of ensuring stable access to engineers who can fit their systems, and also with the intention of using the company to expand and train up the workforce in the UK. Daikin already has around 490 employees in the UK and over 11,000 in the Europe, Middle East and Africa region.

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