KEMET Invests $50 Million in NEC Tokin, Holds 51% Controlling Interest
KEMET Corporation and NEC TOKIN Corporation have closed the first step in establishing an alliance with the completion of a capital injection of USD 50 million (approximately JPY 4.4 billion) by KEMET Electronics Corporation, KEMET's wholly-owned subsidiary (collectively with KEMET Corporation, into NEC TOKIN.
KEMET and NEC TOKIN entered into definitive agreements on this alliance on March 12, 2012, and are expecting to pursue synergistic efforts to enhance the two companies' global businesses as well as NEC TOKIN's financial base and the recovery of its capacitors business which was severely damaged by the October 2011 flooding in Thailand. KEMET and NEC TOKIN have received all necessary governmental approvals, and the customary closing conditions to the injection have been satisfied.
At the closing, KEMET received a third-party allotment of common shares. Following this allotment and taking into account the non-voting preferred shares assigned to NEC in March 2012, KEMET and NEC Corporation now respectively hold 51% and 49% of the voting interest, and 34% and 66% of the economic interest, in NEC TOKIN.
KEMET and NEC TOKIN expect to utilize this partnership to enhance efficiencies through the cross-selling of both companies' products, greater efficiency of procurement and production, and enhanced product development by sharing technological know-how, while each company will continue to maintain their current independent sales organizations.
NEC TOKIN will continue operating under the same brand and providing its existing lineup of products and services within this alliance. Moreover, in the two companies' extensive product areas, the alliance is expected to enhance further growth of business into the industrial field and worldwide markets, while capitalizing on NEC TOKIN's material technologies and KEMET's expertise in global operations management.