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 markets. 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 2003(scheduled) 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 http://www.omron.com/news/n_280103.html 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 Akahoshi.
SOURCE Omron Corporation Healthcare Company