More info - not good - Mita looks for bankruptcy protection from creditors.
Monday August 10, 7:15 am Eastern Time
Copier maker Mita's protection bid
stirs market
(Adds Sakura Bank comment on loans to Mita)
By Miki Shimogori
TOKYO, Aug 10 (Reuters) - Japanese copier manufacturer Mita
Industrial Co Ltd on Monday announced that it had sought
bankruptcy protection from creditors, joining the long list of victims of the nation's economic slump and the legacy of aggressive expansion overseas.
The news, which suggested the slump is starting to take a toll on the nation's mighty manufacturing sector, sent a shiver through financial markets, fuelling active sales of the already weak yen, while
hurting banking shares on the Tokyo exchange.
''Unlike the recent series of corporate bankruptcies which mostly involved general contractors, financial firms and makers of raw materials, we are now seeing manufacturers of processed products
also emerging as victims,'' said Kohichi Hariya, a Nikko Research Center analyst.
''Anything looks to be possible from now on,'' Hariya said, adding that Japanese firms, which have actively expanded overseas business on the back of the yen's previous strength in the early 1990s, would be forced to rethink their strategy.
Unlisted Mita Industrial, set up in Osaka in 1948, said it went bust with liabilities of more than 200 billion yen ($1.36 billion) after its aggressive expansion overseas backfired in the face of the yen's
current weakness.
Mita said that 65 percent of the firm's overall sales come from overseas, and that it currently enjoyed a 3.5 percent domestic market share in copier equipment, 10.1 percent in the United States and 7.7
percent in Europe.
Mita president Yoshihiro Mita told a news conference that the firm's business had been hurt by the yen's former strength, which prompted it to shift production overseas, mainly to Hong Kong.
This advantage has vanished with the yen's recent weakening and falling office equipment prices amid Japan's economic slump have also hurt Mita.
The company, which has some 2,000 staff, said in a statement that five of its domestic production units had also applied for court protection and a court had appointed an Osaka-based lawyer to
administer its assets.
But it said Mita and the five units would continue to operate production and sales activities in Japan and overseas.
Kyocera Corp , a maker of semiconductor components which has forged an original equipment manufacturer contract with Mita, meanwhile offered to help Mita rebuild its business.
''Although we must wait for the district court's ruling to start Mita's rehabilitation process, we are prepared to dispatch an administrator,'' a Kyocera spokesman said. |
