Nojima, a Japanese home appliance retailer, is pursuing the acquisition of Hitachi's home appliance business.
According to the Nikkei on Tuesday, Nojima is considering acquiring Hitachi Global Life Solutions (GLS), Hitachi's home appliance subsidiary, with the deal value expected to exceed 100 billion yen (approximately 924.4 billion won).
Japan's home appliance industry views Nojima as the final bidder, citing its strengthened appliance brand business, including last year's acquisition of personal computer maker VAIO. Samsung Electronics (005930.KS) and LG Electronics (066570.KS) also showed interest in acquiring Hitachi and submitted letters of intent in August last year, but the deals fell through due to mismatched conditions, according to reports.
"If Nojima acquires Hitachi following VAIO, it will evolve into a specialty store retailer of private label apparel (SPA) model that integrates 'planning-manufacturing-sales,'" the Nikkei said. "When an electronics retailer directly controls a manufacturer's technological capabilities, it can gain an overwhelming advantage in differentiation from competitors."
Hitachi GLS ranks second in Japan's white goods market after Panasonic Holdings and operates production bases in Tochigi, Ibaraki, and Shizuoka. It employed approximately 5,100 workers as of March last year.
Through this sale, Hitachi plans to wrap up the restructuring it has pursued over the past 17 years and concentrate on social infrastructure and digital-based businesses.
Hitachi underwent a major business realignment after posting a loss of 787.3 billion yen (approximately 7.27 trillion won) in the first quarter of 2009. Since then, it has focused on business-to-business (B2B) operations such as information technology (IT) services, power transmission and distribution networks, and railways, establishing a stable revenue base.
It also upgraded its business structure around Lumada, a digital transformation (DX) platform. To this end, it acquired Switzerland's ABB power transmission and distribution business in 2020 and U.S.-based GlobalLogic in 2021, each for 1 trillion yen (approximately 9.25 trillion won).
Hitachi also divested non-core businesses. Major subsidiaries such as Hitachi Metals (now Proterial) and Hitachi Chemical (now Resonac) were sold, and the home air conditioner business was transferred to Germany's Bosch. The overseas home appliance business was also sold to Turkey's Arcelik in 2021.
"We will directly reflect customer feedback gathered at Nojima stores in product development and build a system that cycles from manufacturing to after-sales service (AS)," Nojima President Hiroshi Nojima said. "I am confident that the combined strengths of the two companies will further enhance the value of Hitachi-branded home appliances," Hitachi Vice President Noriharu Amiya said.
