Roland to Go Private

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Jyunichi Miki, president of Roland Corporation, announced at press conference held in Hamamatsu on 14 that the company would go privately held company by management buy out. Tokowaka Corporation in Tokyo headed by Jyunichi Miki conducts TOB to purchase Roland common stock at yen1,875 from May 15 through June 25. Taiyo Fund, the second largest stock holder of Roland has reportedly agreed to support Miki and accept TOB offer. Roland stocks closed at yen1,582 on May 14 jumped up to yen1,868 on 15 after the announcement. It's reported that total amount to complete MBO is 4.16 million yen at the maximum. Miki reportedly serves as CEO of the company after MBO completes.  

The financial crisis in 2008 seriously damaged Roland's sales of digital musical instruments. The transaction is expected to contribute to smooth decision making under new management team, and accelerating structural reform by concentration in core competence. When it goes successful, Roland can move much more flexibly to cope with the changing market and consumer needs.

Miki said, "As a private company, we would rebuild our business structure for sustained growth in the future free from short-term business assessment by stock market." He attributed stagnant sales of Roland digital musical instruments to changing consumer tastes for inexpensive products. Demands for high quality but expensive Roland instruments quickly declined after the financial crisis. The company's consolidated sales for 2013 closed at March 31 turned black after 5 consecutive terms in loss, however, Miki said that it was mainly accomplished by weakened Yen against major currencies, but sales actually deteriorated.

According to 2013 Roland annual report announced on 14, total sales for the year was 8,567 million yen, an 18.4 % increase over the same term of last year. Net profit for the term was 470 million yen against 4,066 million yen loss in 2013.

Roland also announced a plan that Roland D.G., a subsidiary of Roland, manufacturer and distributor of industry inkjet printers, 3D laser scanners, cutting plotters, digital engravers, etc. would buy back 3,560,000 stocks of Roland D.G owned by Roland, which represent 40% of the total stocks. If voting stocks of Roland declines under 40%, Roland D.G. will become an affiliated company accounted for by the equity-method.


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This page contains a single entry by jmtrades published on May 16, 2014 5:27 PM.

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