Casio 2010 Annual Report Download - page 48

46 CASIO COMPUTER CO., LTD.
(3) Merger between NEC Corporation’s mobile terminal unit and Casio Hitachi Mobile Communications Co., Ltd.
The Company, NEC Corporation (NEC), and Hitachi, Ltd. (Hitachi) agreed to integrate and operate their respective mobile
terminal businesses as a joint-venture company. On March 24, 2010, Casio Hitachi Mobile Communications Co., Ltd. (CHMC), a
consolidated subsidiary of the Company, concluded a merger agreement with NEC CASIO Mobile Communications, Ltd. On April
20, 2010, a memorandum was signed to change the effective date of the integration to June 1, 2010. On June 1, 2010, CHMC
merged with NEC CASIO Mobile Communications, Ltd.
Summary of business combination performed by subsidiary
1) Name and business of business combination including subsidiary
a. Surviving company
Company Name: NEC CASIO Mobile Communications, Ltd.
Business Summary: Mobile terminal development, production, sales and maintenance
b. Merging company
Company Name: Casio Hitachi Mobile Communications Co., Ltd. (a consolidated subsidiary)
Business Summary: Mobile terminal development, design, production, procurement, quality control, sales and maintenance
2) Reason for the business combination
The Company, NEC and Hitachi agreed to integrate and operate their respective mobile terminal businesses as a joint-venture
company.
NEC CASIO Mobile Communications, Ltd. completely integrated NEC’s Mobile Terminal Operations Unit with CHMC’s entire
business including sales, development, production and maintenance. The new company boasts a highly competitive range of
products that merges the advanced technologies and product development capabilities of each company. Furthermore, combination
of NEC’s IT/Network technology supported by product development capabilities linked to service business for enterprises and
consumers, and CHMC’s consumer product technologies and planning strength, is expected to result in the creation of innovative
synergies and the development of appealing new products, in addition to future growth area.
The Company, NEC and Hitachi integrate their mobile terminal business in order to strengthen both domestic and international
business while increasing competitive strength and capitalizing on each company’s brand recognition by (1) achieving synergies in a
variety of fields, including sales expansion, procurement and customer service, and (2) reinforcing product development by unifying
technological assets, know-how and resources.
3) Date of business combination
June 1, 2010
4) Summary of business combination including its legal form
a. Merger method
Absorption-type merger where NEC CASIO Mobile Communications, Ltd. is the surviving company and CHMC is dissolved.
b. Allocation of shares
In this merger, NEC CASIO Mobile Communications, Ltd. issues 3,400 shares of common stock in NEC CASIO Mobile
Communications, Ltd., which then allocate the shares of common stock to the registered shareholders of CHMC on a day before
the effective date of the merger in accordance with the percentage of share ownership of CHMC’s shareholders on the same date.
Summary of accounting procedures
Accounting procedures are based on ASBJ Statement No. 7, “Accounting Standard for Business Divestitures” (Revised on December
26, 2008) and ASBJ Guidance No. 10, “Guidance on Accounting Standard for Business Combinations and Accounting Standard for
Business Divestitures” (Revised on December 26, 2008).
Business segment included in the spun-off business
Electronics
Estimated total income of the subsidiary in the consolidated statement of operations for the year ended March 31, 2010
Net sales: ¥99,623 million ($1,071,215 thousand)
Notes to Consolidated Financial Statements Years ended March 31, 2010 and 2009 Casio Computer Co., Ltd. and Subsidiaries