Hitachi, Mitsubishi Heavy discuss potential merger

Hitachi Ltd. and Mitsubishi Heavy Industries, Ltd. Are reportedly discussing the possibility of merging their businesses. The move could result in one of the world’s largest comprehensive infrastructure firms. The two companies are considering a broad integration which will include key infrastructure and information technology business by April 2013, pending approval from the Japan Fair Trade Commission. Infrastructure operations will include nuclear and fossil-fuel-burning power plants, renewable energy, water treatment and rail cars. Other details such as the form of the integration and the future of Mitsubishi Heavy’s defense business will be discussed later. Both firms generated combined sales of more than ¥12 trillion (US$157.1 billion).
Powerful merger
Hitachi is known in the world as the only comprehensive electrical machinery maker that handles infrastructure and IT systems. Mitsubishi Heavy is a dominant presence in heavy electrical machinery and boasts a wide range of products in power generation equipment, including nuclear and fossil fuel systems. It is also a key player in the field of renewable energy.
The two companies are expected to complement each other in the areas of products and system. In 2000, they merged their steelmaking equipment business. Last year, the two firms combined their hydroelectric power equipment operations. They are also partners in developing and producing railway systems. If the business integration proceeds, the merged company would become the second largest domestic manufacturer after carmaker Toyota Motor Corp. (August 4, 2011)