Omron to Separate Its Healthcare Business

Jan 28, 2003, 00:00 ET from Omron Corporation Healthcare Company

    TOKYO, Jan. 28 /PRNewswire/ -- Omron Corporation, Japan's leading maker of
 control components, today announced a decision to separate the business
 planning and marketing functions of its healthcare business and integrate
 these in a new company to be formed with wholly-owned development subsidiary
 Omron Institute of Life Science Co., Ltd. (OLS).
     The new company will be positioned as a specialist manufacturer of medical
 equipment and provider of associated healthcare services and will initially be
 a wholly owned Omron Corporation subsidiary.  Inauguration is tentatively set
 for July 1, 2003.
     "Business opportunities in the medical-equipment and healthcare-service
 sectors are rapidly expanding.  We have decided that to take full advantage of
 this growth, our healthcare business must be managed as an independent
 specialist manufacturer of medical equipment and provider of associated
 healthcare services," Omron Corporation CEO Yoshio Tateisi said.
     Omron's healthcare business has established the Omron name as a leading
 world brand in the personal health equipment industry, as typified by Omron's
 65% global market share for home-use blood-pressure monitors.  Yet established
 business lines such as these monitors and thermometers face challenging
 medium-term prospects, given the slowing growth in the company's existing
     Meanwhile, rising medical costs are prompting healthcare providers
 attempting to tackle those spiraling costs to increasingly focus on early
 detection and treatment of lifestyle diseases (especially by promoting
 positive lifestyle changes).  These developments are creating new business
 opportunities in the medical-equipment and healthcare-service sectors.
     Against this backdrop, Omron has identified lifestyle disease monitoring
 as the new company's core growth domain.  The company will focus resources on
 developing personal products in the medical healthcare-equipment and lifestyle
 disease-monitoring markets while working to enhance its ability to generate
 revenue growth.
     To this end, Omron has concluded that its healthcare business should be
 conducted as a financially and managerially independent specialist
 manufacturer of medical equipment and provider of associated healthcare
 services.  This decision culminated in a proposal to split its healthcare
 business off and integrate it with the development functions of OLS.
     Full details of the reorganisation and business integration will be
 disclosed after the separation plan has been approved at a board meeting
 scheduled in early May.  Healthcare Business Company and Omron Institute of
 Life Science employees will be transferred to the new company.
     "The new company will take steps to make itself more agile and maximise
 its business potential.  By building a management infrastructure incorporating
 human resources and IT systems, creating a challenge-oriented corporate
 culture and fostering efficient decision-making procedures, our new subsidiary
 will be able to optimise its organisation and business processes," Omron CEO
 Tateisi said.
     "This reorganisation of Omron's healthcare businesses should have no
 impact on our parent or consolidated earnings for the current fiscal year
 ending March 31 next," he stressed.
     For reference:
     Separation timetable
     Board meeting to approve split-off reorganisation plan: Early May
     Authorization of split-off reorganization plan: Early May 2003 (scheduled)
     Date of split-off: July 1, 2003 (scheduled)
     Registration of split-off: July 1, 2003 (scheduled)
     Separation method
     Separation will take the form of a split-off of existing corporate units
 and the joint formation of a new stock company to assume their functions and
 operations under the provisions of the new corporate divestiture rules
 provided by the 2000 revision of Japan's Commercial Code.  The new company
 will be a wholly owned subsidiary of Omron Corporation and will integrate the
 operations of its current healthcare businesses (business planning and
 marketing) and those of the Omron Institute of Life Science Co., Ltd. (OLS),
 currently a wholly owned Omron development subsidiary.
     Overseas marketing locations
     Overseas marketing locations will be gradually incorporated into the new
 company's operations under a program scheduled for completion during the
 period spanning fiscal years 2003 through 2005.
     The press release separately issued by Omron Corporation PR Office is also
 available at
     About Omron
     Omron Corporation, headquartered in Kyoto, is Japan's largest producer of
 control components and systems.  Established in May 1948 and headed by CEO
 Yoshio Tateisi, Omron employs some 25,000 people worldwide and for the year
 ended March 2002 posted consolidated sales of 534 billion yen
 ($4,015 million).
     Omron Healthcare Company is a wholly owned subsidiary of Omron Corp and is
 based in Tokyo.  A specialist firm in healthcare equipment, including digital
 blood pressure monitors, digital thermometers, body fat meters and nebulisers,
 Omron Healthcare employs about 2,386 staff worldwide and recorded sales to
 March 2002 of 40.6 billion yen ($305 million).  Its president is Keiichiro

SOURCE Omron Corporation Healthcare Company