Kobelco Cranes and Construction Machinery to Merge by April 1 | Construction News

Kobe Steel, Ltd., Tokyo, Japan, and its wholly owned subsidiaries, Kobelco Construction Machinery Co., Ltd. and Kobelco Cranes Co., Ltd., reached a decision today to merge the businesses of Kobelco Construction Machinery and Kobelco Cranes, effective April 1, 2016.

The Kobe Steel Group’s construction equipment business saw Kobelco Construction Machinery spinning off the crane business in 2004. Following the establishment of Kobelco Cranes, the two companies have specialized in their respective fields in Japan and overseas.

Under its medium-term business plan launched in May 2013 covering fiscal years 2013 to 2015, the Kobe Steel Group said it would strategically expand its machinery-related businesses. The Kobe Steel Group has decided to merge the two companies as it considers it necessary to further strengthen its business foundation and accelerate global development in relation to the construction equipment business.

This merger is expected to improve business efficiency, strengthen product development capabilities, and bolster global development. It will also enable Kobe Steel to pursue new possibilities from the synergy derived from the accumulated technologies of its excavators and cranes. Considerations will continue with regard to the consolidation of domestic and overseas locations.

The new company aims to take a new leap forward as a comprehensive construction machinery manufacturer that combines the two product menus of excavators and cranes.

From development to procurement, manufacturing, quality and sales, the organization and business will be reviewed. Combining and rearranging common operations will increase business efficiency, while the effective utilization of management resources will strengthen management.

The synergy from environmental technologies for fuel efficiency and low noise, basic technology for new materials, and other common elemental technologies will improve the technical level of the new company. New product development is anticipated from combining the technologies of excavators and cranes.

Sharing human resources at overseas locations, combining common operations, and other measures will improve efficiency and further strengthen global development.

An absorption-type merger will be undertaken with Kobelco Construction Machinery as the continuing company and Kobelco Cranes as the absorbed company.

As the merger will be between two wholly owned subsidiaries of Kobe Steel, no value for the merger is issued.

Kobelco Construction Machinery Co., Ltd. was established in 1999 and is headquartered at Tokyo, Japan. It is owned 100% by Kobe Steel and has 6,745 employees. The company manufactures, sells, and services construction and transport machinery, including hydraulic excavators, mini excavators, wheel loaders, building-demolition equipment, and other machines.

Kobelco Cranes Co., Ltd. was established in 2004 and is headquartered in Tokyo, Japan. It is owned 100% by Kobe Steel and has 884 employees. It develops, manufactures, sells, and services crawler cranes, rough-terrain cranes, civil-engineering machines, work vessels, and other machines.

As the merger will take place between two wholly owned consolidated subsidiaries, Kobe Steel anticipates that the merger will have an insignificant impact on its consolidated results.