The story appears on

Page B8

November 17, 2009

GET this page in PDF

Free for subscribers

View shopping cart

Related News

Home » Business » Manufacturing

Hitachi to raise capital as losses mount

MIRED with losses, Japan's biggest electronics group by sales, Hitachi Ltd, is raising up to US$4.6 billion to cut debt as it seeks to turn around its sprawling businesses and invest in new growth drivers.

The capital raising, the company's first in 27 years, follows similar moves by NEC Corp and Toshiba Corp, and sent Hitachi's shares down 8.5 percent in the biggest drop in six months yesterday even though markets had been expecting the announcement.

Some analysts said the company might be forced to tap markets again and that Hitachi had sought to seek money before it could form a realistic plan for recovery.

"This amount is the absolute limit that Hitachi can seek from markets, but this may not be enough even to cover restructuring costs at such a mammoth firm, let alone invest in growth," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management Co.

"I don't think investors will want to put their money in. There are so many more deserving companies that need funds."

Hitachi, a sprawling conglomerate with over 900 group firms and sales of 10 trillion yen (US$111.66 billion), is headed for its fourth straight annual loss.

The group is seeing a recovery in its hard-drives business and strong sales of its metals, cables and construction machinery but this has not been enough to counter the impact of losses in its flat TVs and semiconductors businesses.

Hitachi earns the bulk of its sales from making nuclear reactors, bullet train systems, elevators and IT services. The group will be using almost half the money it raises to pay back debt.


Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.

沪公网安备 31010602000204号

Email this to your friend