Japanese manufacturing giant Nidec Corporation plans to acquire well-known machine tool manufacturer Mikino for 257 billion yen (about $1.6 billion). The acquisition price is 42% higher than Makino's closing price on the previous trading day, showing Nidec's ambitions in the machine tool field.
As a leading global manufacturer of precision motors, Nidec has faced the dilemma of weak demand for hard drives and fierce price competition in the Chinese electric vehicle market in recent years, which has squeezed its profit margins. Therefore, Nidec chose to turn its attention to the more profitable machine tool industry. Since 2021, it has begun a series of acquisitions in this field, gradually forming a full coverage from large machining centers to small and medium-sized precision machine tools, and its strength ranks fourth in the Japanese machine tool industry.
The acquisition of Makino means that Nidec has taken an important step in strengthening its machine tool business. If successful, its machine tool product sales will be pushed up from 120 billion yen to 350 billion yen, close to the 500 billion yen level of industry leader Mori Seiki. This move not only intensified Nidec's integration process in the machine tool field but also fully responded to the policy background of the Japanese government to encourage corporate mergers and acquisitions and promote industry integration.
Makino Milling Machine has advantages in high-end products such as machine tools for aviation parts that require precision processing. It also operates "electrical discharge machines" for precision processing of molds and difficult-to-cut metals such as titanium.
Machine tools have many fields depending on the materials and shapes they process. By acquiring Makino Milling Machine, Nidec hopes to develop a complete product lineup.
Nidec's acquisition is not only an integration of Makino Milling Machine's technology and market resources but also part of its global strategy to enhance the company's competitiveness and market share in the global manufacturing industry.