Kawai Musical Instruments Mfg. Co., Ltd. (Referred to hereinafter as Kawai; Head office: Hamamatsu City, Shizuoka Prefecture; President: Hirotaka Kawai) and GE Capital Consumer Finance Corporation (referred to hereafter as GE Capital Finance; Head office: Meguro-ku Tokyo;
President & CEO: Taketo Yamakawa) today reached agreement on terms under which Kawai will sell the sales finance business of its consolidated subsidiary Kawai Assist Co. Ltd. to GE Capital Finance in an asset transaction.
Kawai has been operating the sales finance business through its consolidated subsidiary Kawai Assist. However, in a radically changing business environment, including maturing of the market and increasingly fierce competition, Kawai determined it would be strategically advantageous for it to assign this segment of its business to GE Capital Finance, with its strong experience in consumer finance. The transaction will simultaneously allow Kawai to realize cash proceeds from the sale with which to reduce existing indebtedness, as well as to concentrate its business resources on its core business segments so as to promote operational effectiveness within the Kawai Group. Kawai believes the improved financial structure and refocusing on core segments that will be made possible by this transaction will reduce the impact on Kawai of any changes in the finance sector.
Transfer of this business to GE Capital Finance will enable GE Capital Finance to further strengthen its sales finance business.
Although the environment surrounding the sales finance sector remains severe, GE Capital Finance believes that the world-wide financial services expertise and management systems such as Six Sigma Quality, Digitization and sales methods it can tap as a member of the GE group of companies will enable it to provide high value-added services to customers and compete effectively in this market. As an active participant in the credit card business, handling GE Visa cards and other consumer financial products, GE Capital Finance anticipates bringing value-added opportunities to Kawai's customers through a card business partnership with Kawai in the near future.
Details Of Business Transfer
1. Details of the transferred business: Sales finance business
conducted by Kawai Assist Co., Ltd.
2. Operating revenue for March 2001 period relating to business
to be transferred:(Y)4.133 billion.
3. Content of transfer: Receivables and assets related to sales
finance
4. Transfer value and method of payment: Transfer value will be
market value, as calculated on the day of the transfer of the
business; amount is to paid in full in cash.
5. Scheduled date of business transfer: July 1, 2002.
Overview Of Kawai Assist Co., Ltd.
1. Head office: 353-3, Sunayama-cho, Hamamatsu City, Shizuoka
Prefecture
2. Primary business: Purchasing of installment obligations,
collection agency duties, leasing
3. Date established: March 1966
4. Representative: Toru Fukuda, President
5. Capital:(Y)90 million
6. Sales:(Y)6.751 billion (March 2001 period)
7. No. of employees: 114 (as of January 2002)
8. Primary shareholder and percentage of shares held: Kawai
Musical Instrument Mfg. Co., Ltd. 100%
Overview Of Transferee
1. Company name: General Electric Capital Consumer Finance
Corporation (GECCF) http://www.geccf.gcf.co.jp
2. Head office: 3rd Floor Alto Ito Building, 6-21, Mita 1-chome,
Meguro-ku, Tokyo, Japan
3. Primary business: Sales finance, credit card services
4. Date established: October 1994
5. Representative: Taketo Yamakawa, President & CEO
6. Capital:(Y)12.762 billion
7. No. of employees: Approximately 700
8. Primary shareholder and percentage of shares held: GE Capital
International Holdings Inc. 100%
About GE Capital (http://www.gejapan.com)
GE Capital, with assets of more than $425 billion, is a global, diversified financial services company grouped into six key operating segments comprised of 25 businesses. A wholly owned subsidiary of General Electric Company ( GE ), GE Capital, based in Stamford, Connecticut, provides a variety of consumer services, such as credit cards, life insurance and car insurance; mid-market financing; specialized financing; specialty insurance; equipment management, and specialized services to businesses and individuals in 45 countries around the world.
GE is a diversified services, technology and manufacturing company with operations worldwide.
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CONTACT: Kawai Musical Instruments Mfg. Co., Ltd.
Hiroshi Shikamata, Executive Managing Director,
053-457-1227
or
GE Capital Consumer Finance
Atsuko Ishida, Communications, 03-5724-6208
Cristy Williams
[email protected]
678.518.2596