Japanese Electronics Companies on the Edge. An Analysis of Corporate Data and Corporate Strategies

Following the global slump in spending for IT products and related services
Japanese integrated electronics companies as many of its international peers
posted losses. Given the large exposure to its home markets, high operating
expenses, further cash-draining restructuring measures, a low equity basis,
increasing uncovered pension obligations as well as the unlikelihood of a
market recovery in the short term these companies are facing the risk of loosing
access to the capital market for further expansion. As a result non-capital
binding measures such as alliances or partnerships with foreign counterparts
are likely to be the harbinger of an M&A wave or the sell-off of profitable
group affiliates.

Martin Kohlhase is a Heinz Nixdorf scholar and has been in Japan since
November 2002, where he concentrates on researching Japanese technology companies
as well as keiretsu groups. He has spent more than 3 years in Frankfurt and
London working as an equity analyst covering European technology companies.
Mr. Kohlhase holds a master’s degree in economics from the University of Konstanz,
Germany.