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 user 2009-11-17 at 11:00:27 am Views: 64
  • #22951
    Canon  buys Dutch Oce for $1.1 bln, fights Ricoh
    * Canon to offer 8.60 euros/shr, including dividend
    * Deal worth 1.5 bln euros including debt, other obligations
    * Oce management and supervisory board support offer
    * Some pref holders and shareholders support deal
    * Oce shares up 68.5 pct

    TOKYO/AMSTERDAM, Nov 09  – Japan’s Canon  plans to buy Dutch copier and printer maker Oce for 730 million euros ($1.09 billion), challenging rivals Ricoh and Xerox  in a hunt for growth during the sector downturn.Copier and digital camera maker Canon and Oce said in a joint statement Monday that Canon intends to offer 8.60 euros per share, or 730 million euros, for Oce’s outstanding shares. The offer represents a premium of 70 percent to Oce’s Friday close.

    Canon’s offer follows little over a year after Japan’s Ricoh, the world’s largest copier maker, bought U.S. office equipment distributor Ikon Office Solutions, a deal which hit Canon’s U.S. operations hard as Canon machines had represented 60 percent of the products Ikon handled before the acquisition. Canon, Oce and rivals have suffered from the economic slump, which forced companies to cut spending, including costs on copying and printing.Oce, which was loss-making in the past two quarters, has been cutting costs and jobs and has not paid a final 2008 dividend, while Canon and Ricoh reported sharp falls in their quarterly profit last month. “The deterioration of the economic market circumstances has influenced the performance of the industry but it was not the initiator for the strategic review process which, after thorough and careful evaluation, led to this proposal of joining forces with Canon,” Oce CEO Rokus van Iperen told reporters.

    Canon and Oce products are mutually supplementary, with the Japanese company having strength in regular office machines and mid- to lower-end production printers, while Oce excels in high-end production printers and advertisement-use large-sized printers, the Tokyo-based company said.Production printers, or digital commercial printers, are used to print such documents as product manuals and direct mail quickly and in large volume, and are a fast-growing segment of the global printer market.Oce shares were up 68.5 percent at 8.53 euros by 1119 GMT, after earlier reaching their highest level since June last year.Including debt and other obligations, the deal values Oce — which competes with Xerox and Konica Minolta Holdings — at about 1.5 billion euros ($2.2 billion), Van Iperen said.

    Analysts said the deal was good for Oce shareholders, as it solved most or all of the problems the company faced due to the drop in demand. They were divided about a possible rival offer.SNS Securities said in a note Hewlett-Packard and Kyocera  had sufficient financing options for a counter bid, while Ricoh and Konica Minolta currently had high debt levels and relatively low earnings generation.Petercam analyst Eric de Graaf, however, said it was unlikely that another bidder would emerge because of the bid price and commitment of some shareholders and Oce’s boards.Preference share holders Ducatus, ASR and ING — which together hold 19 percent of Oce’s share capital — agreed to sell their interests to Canon, while Oce shareholder Bestinver Gestion S.A. has agreed to tender its 9.5 percent stake.Oce’s management and supervisory boards support and will recommend the intended offer, Oce and Canon said.Canon, the world’s largest digital camera maker, is Japan’s 6th-most valuable company with market capitalisation totalling $50 billion. Its printers and copiers accounted for 65 percent of total revenues in 2008.

    Analysts said the deal is positive for Canon, while potentially negative for rival Japanese copier and printer maker Konica Minolta, which is in a business alliance with Oce.”Konica Minolta procures high-end production printing machines from Oce, while Oce procures lower-end machines from Konica Minolta,” Mizuho Securities analyst Ryosuke Katsura said.”(The) chances are Canon machines will replace Konica Minolta gear in this relationship,” he said.Shares in Canon closed down 1.5 percent at 3,370 yen ahead of the announcement, underperforming the benchmark Nikkei average .N225, which gained 0.2 percent.
    Canon to acquire biggest European printer maker Oce of Netherlands
    Canon Inc. said Monday it will buy out Oce NV of the Netherlands, the biggest printer maker in Europe, through a tender offer worth about 730 million euros (some 100 billion yen) to create a global leader in the printing industry.In what will be Canon’s largest merger and acquisition, the Japanese company said it will buy all outstanding shares in Oce for 8.60 euros per share.The move by the Japanese maker of digital cameras and printers comes as the global economic downturn has dented sales of office machines, including ink-jet printers.Canon plans to launch the friendly takeover bid between January and March with the aim of making the Dutch company a wholly owned subsidiary.By putting Oce under its wing, Canon officials said the Japanese company aims to capitalize on the Netherlands-based firm’s strong sales clout in Europe and the United States.As Canon specializes in small printers for office use and Oce is strong in the area of large, high-speed printers, Canon is aiming to raise its global competitiveness by building up its product lineup, the officials said.

    Canon President Tsuneji Uchida said at a news conference in Tokyo he sees his company’s partnership with Oce as a ”marriage” with a good partner that will yield benefits in their printer business.”The products we sell and our targeted customer bases are different, so we believe that by teaming up with Oce, we can come up with a full product lineup and expand our market, and are aiming to be No. 1 in the printing industry,” Uchida said.Anton Schaaf, Oce’s chief technology officer and chief operating officer, told the same news conference, ”This collaboration will significantly strengthen our distribution power by combining our sales networks in Asia, the United States and Europe.”

    Oce’s sales network has spread to more than 30 countries, mainly in Europe and the United States, with about 40 percent of its revenues coming from the United States. Founded in 1877, Oce’s 2008 revenues were roughly 2.9 billion euros.Uchida did not give numerical targets for profit or sales following the takeover, simply reiterating that the two companies’ products and services are ”complementary.”He said it will take about three years for the synergy effect of their integration to be translated into revenues.Canon has reported its group net profit and sales for the last business year to December fell 36.7 percent to 309.15 billion yen and 8.6 percent to 4.09 trillion yen, respectively, marking their first drops in nine years partly due to falling demand amid the global economic slowdown.