17.12.2015, 14:26
Sumitomo Mitsui Finance and Leasing acquires General Electric Group’s leasing business in Japan
OREANDA-NEWS. Sumitomo Mitsui Finance and Leasing Company, Limited (SMFL; President: Yoshinori Kawamura) has reached an agreement with GE Ireland USD Holdings Unlimited Company (GE Ireland), a subsidiary' of General Electric Company (GE; Chairman & CEO: Jeffrey Robert Immelt), on the acquisition of GE group's leasing business in Japan, subject to regulatory approval.
SMFL will acquire three leasing businesses*1 of the GE group's leasing business in Japan-equipment/asset leasing business, small-ticket leasing business and automotive leasing business (earning assets: approx. JPY510 billion as of December 31, 2014Hor approx. JPY575 billion by acquiring 100% equity interest in GE Japan LLC*2 (tentative name) owned by GE Ireland, and making the company its subsidiary'.
The Japanese leasing industry has substantial scale, with the volume of leasing transactions totaling approx. JPY5 trillion. Leasing demand is expected to remain steady, underpinned by a continued increase in corporate capital spending as the Japanese economy recovers under Abenomics.
Against this backdrop. SMFL and GE Japan aim to solidify their top-class position in the Japanese leasing market in terms of both quality' and quantity by leveraging each other's know-how and resources, thereby further increasing their enterprise value. In terms of quality, GE Japan has the unique know-how developed under GE, including efficient data marketing and business models utilizing digital innovation, the best-in-class automated credit screening system, sophisticated advisory business, and diversified cross-selling strategies. By leveraging this unique know-how, the marketing strategies and sales capabilities are aimed to be upgraded. In terms of quantity, GE Japan has a client base of approximately 483,000 companies with very little overlap with SMFL’s client base. As a result, the combined client base of SMFL and GE Japan will be one of the largest in Japan, enabling them to offer a wide-range of sophisticated solutions for the needs of an even larger client base, and achieve cost synergies and other economies of scale.
SMFL will acquire three leasing businesses*1 of the GE group's leasing business in Japan-equipment/asset leasing business, small-ticket leasing business and automotive leasing business (earning assets: approx. JPY510 billion as of December 31, 2014Hor approx. JPY575 billion by acquiring 100% equity interest in GE Japan LLC*2 (tentative name) owned by GE Ireland, and making the company its subsidiary'.
The Japanese leasing industry has substantial scale, with the volume of leasing transactions totaling approx. JPY5 trillion. Leasing demand is expected to remain steady, underpinned by a continued increase in corporate capital spending as the Japanese economy recovers under Abenomics.
Against this backdrop. SMFL and GE Japan aim to solidify their top-class position in the Japanese leasing market in terms of both quality' and quantity by leveraging each other's know-how and resources, thereby further increasing their enterprise value. In terms of quality, GE Japan has the unique know-how developed under GE, including efficient data marketing and business models utilizing digital innovation, the best-in-class automated credit screening system, sophisticated advisory business, and diversified cross-selling strategies. By leveraging this unique know-how, the marketing strategies and sales capabilities are aimed to be upgraded. In terms of quantity, GE Japan has a client base of approximately 483,000 companies with very little overlap with SMFL’s client base. As a result, the combined client base of SMFL and GE Japan will be one of the largest in Japan, enabling them to offer a wide-range of sophisticated solutions for the needs of an even larger client base, and achieve cost synergies and other economies of scale.
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