News Releases 2019Regarding capital increase at Meidensha’s Chinese subsidiary

Meidensha Corporation (Meiden) decided to increase the capital of Meiden Hangzhou Drive Technology Co., Ltd., a wholly owned subsidiary in China, at a board of directors meeting held on May 31, 2019. Details of the increase are as follows. 

1. Capital increase purpose and background

Meiden has positioned motors and other components for electric vehicles (EVs) as a pillar of its growth businesses in the Medium-Term Management Plan 2020. Demand for these vehicles is expected to increase due to the global trend toward environmental protection and more stringent environmental regulations.

The capital increase follows Meiden’s announcement last July it would spend a total of ¥7 billion in EV business-related capital investment at three domestic plants. The latest investment is aimed at establishing the company’s first overseas production hub for EV-related products by injecting ¥4.1 billion into Meiden Hangzhou Drive Technology, which it set up with capital of ¥150 million in China – the world’s largest automobile market.

2. Outline of the subsidiary

  1. Name

  Meiden Hangzhou Drive Technology Co., Ltd.

  2. Address

  No.477, Hongxing Road, Qiaonan District, Xiaoshan
  Economic & Technological Development Zone, Hangzhou,
  Zhejiang, China

  3. Chairman & general manager

  Masahiko Satoh

  4. Business operations

  Production and sale of motors and inverters for electric
  vehicles and plug-in hybrid electric vehicles

  5. Capital

  ¥150 million (before the capital increase)

  6. Date of establishment

  May 16, 2019

  7. Capital provider

  100% by Meidensha Corporation

  8. Relationships with Meiden

  Capital relationship: Wholly owned subsidiary
  Personnel relationship: Chairman and General Manager
  Masahiko Satoh dispatched to the subsidiary from Meiden
  Business relationship: Undecided

3. Outline of the capital increase

1) Amount                             ¥4.1 billion
2) Capital after the increase     ¥4.25 billion
3) Investor                             Meidensha Corporation
4) Payment date                     Undecided

4. Schedules and products to be manufactured

  1. Date of endorsement by board of directors

  May 31, 2019

  2. Start of factory construction

  Scheduled for November 2019

  3. Completion of factory construction

  Scheduled for July 2020

  4. Start of operations at the factory

  Scheduled for March 2021

  5. Products to be manufactured

  Motors for EVs

  6. Maximum production capacity

  170,000 units annually

5. Future prospects

The impact of this capital increase on Meiden’s consolidated business performance will be minor. Meiden will swiftly report any development if doing so is deemed necessary.

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