Pentel Discussions Ongoing, Says Kokuyo

Pentel Discussions Ongoing, Says Kokuyo

(August 21) - Japanese stationery and office furniture giant Kokuyo has said it is holding discussions with Pentel’s management following its acquisition of an indirect stake of around 37.5% in the writing instruments manufacturer.

In May, Kokuyo spent around $90 million to buy out the 37.45% holding in Pentel owned by private equity firm Mercuria Investment. Kokuyo said the alliance of the two stationery companies would enhance the value of both entities and allow it to expand globally via Pentel’s established distribution in the US and other overseas markets.

In its recent H1 report, Kokuyo said that it had held several high-level meetings with Pentel and that discussions were still ongoing. It reiterated that it would share its corporate resources and pursue joint initiatives with the writing instruments specialist.

For the first six months of the year, Kokuyo’s sales edged up by 0.3% to around ¥168 billion ($1.57 billion), with a mixed performance from the three reporting divisions.

At the Spatial Value workplace environments unit, H1 revenue was up 1.5% to ¥81.6 billion after seeing “brisk” sales of office furniture. Sales at the B2B reselling division – which includes Kaunet – were up 0.7% to ¥59.5 billion driven by the large customer segment. Finally, the Global Stationery manufacturing arm reported a sales decline of 2% to ¥43.5 billion after a drop in B2C sales.

Kokuyo’s H1 operating profit fell by about 15% as earnings were squeezed by a combination of higher raw material and distribution costs and increased marketing spend at the Kaunet and office furniture businesses.  (OPI)