TOKYO - Kanto Auto Works Ltd. plans to merge three affiliated suppliers in a streamlining, cost-cutting move. The move is the latest in a series of equity shuffles within the extended Toyota Group that have tended to tighten the links within the group and made it less susceptible to mergers and acquisitions from outside.
The new maker of stamping and other metal parts will be known as YIS (pronounced 'wise') for Young Innovating Supplier. It will be capitalized at ¥100 million, or about $952,000 at current exchange rates, and will employ 390. The merger is effective April 1, the start of Japan's fiscal year.
The three firms to be merged are Sanyo Kogyo, Ishikawa Kogyo, and Yokosuka Kogyo. Kanto Auto Works owns 72.1 percent of Sanyo, 61.1 percent of Ishikawa and 46.7 percent of Yokosuka.
Toyota Motor Corp. owns 48.9 percent of Kanto Auto Works.
Kanto Auto Works predicted that the newly merged company would post revenues of $99 million in the fiscal year ending March 31, 2001, but would barely break even that year.