The Birth of a new Toyota Tsusho
We take great pleasure in announcing as of April 1, 2006, the merger of the Toyota Tsusho Corporation and Tomen Corporation.
Toyota Tsusho, as the sole trading company in the Toyota Group, dealing in products including metals, machinery and electronics, vehicles, energy and materials, and consumer products and services, has been rapidly expanding its overseas business activities as a consequence of Toyota Motor?s worldwide strategy. Under its Vision 2010 (a long-term management plan), Toyota Tsusho, in addition to further reinforcing its vehicle-related business activities, intends to transform itself to achieve a well-balanced profit structure by expanding its non-vehicle business activities as well and to address the task of solidifying its management resources.
Tomen, as a general trading company dealing in chemicals, produce and foodstuffs, textiles, electronics, and machinery and energy, has been endeavoring to construct a stable income base. However, amid an environment of aggressive expansion by its competitors into new business areas through rapidly expanding markets such as those emerging in the BRICs economies and through innovations in technology, Tomen has had to face the task of creating new business areas as part of the promotion of its growth strategy, in order to continue its future development.
Toyota Tsusho and Tomen have been engaged in capital tie-ups and business partnerships since March 2000. In light of these circumstances, both companies have decided that in order to achieve greater expansion of business scope and to facilitate the creation of new business opportunities, thereby ultimately realizing the further enhancement of corporate value, a merger of the two would be the best option.
The merger of the two companies will not only enable the realization of their growth strategies by making maximum use of their respective management resources. It will also allow for the construction of a well-balanced segment structure through the allocation of management resources from the standpoint of what is best for the whole enterprise.
We are integrating the inherent strengths of these two formerly independent corporations into one efficient organization that will quickly and expertly respond to the needs and expectations of our clients. We are also introducing an executive officer system within the new corporation in order to increase the speed of decision-making and duty performance.
Thank you for being one of our valued stakeholders, and we look forward to providing you with higher improvement of corporate value now and in the future.
Medium-to-Long-Term Management Strategy
The Company has established the following long-term strategies based on the above basic policy and vision. We have also formulated a long-term management plan for five years forward which is reviewed every year so that the Company can remain responsive to the changing environment.
[Long-term Policy in 2010]
1. Deepen and evolve business models with functions ; global development of exsisting models and establishment of new models
2. Expand businesses for establishment of the second core after automotive-related business
3. Reinforce development in BRICS (Brazil, Russia including Central & East Europe, India, China and South Africa)
4. Further strengthen group management system based on divisional management
5. Distribute management resources and Implement business portfolios under company-wide optimization
"Our Philosophy & Vision" is here
Management Index
At the Toyota Tsusho Group, we have established a greater than 10.0% consolidated ROE as one of the goals of the long-term management plan. At the same time, the Company utilizes a proprietary management index that adopts the conventions of capital costs as a way to measure progress relating to the pursuit of added value creation and profitability of product divisions. Needless to say, the management executes strategies with the overall goal to increase shareholder value.
Basic Policy Regarding Corporate Governance
Under the basic policies and corporate vision mentioned above, the Toyota Tsusho Group actively pursues financial health, managerial efficiency, transparency and compliance with all applicable laws and regulations. In addition, the Company has established an internal "CSR Committee" in accordance with the Japanese Business Federation's "Corporate Behavior Chapter." The committee is charged ensuring a high level of corporate ethics and implementation of sustainable growth strategies in the Company's business affairs.
Basic Policy Regarding Earnings Distribution
The Toyota Tsusho Group aims to provide continuous dividends in a stable manner. We will consider current business performance and the long-term goal of increasing future corporate value in holistically to ensure that shareholder expectations are met.
April 1, 2006
Junzo Shimizu, President
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