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32
SPECIAL FEATURE:
GROWING STRONGER AND EXPANDING OMRON’S REACH THROUGH M&A
Because we live in a rapidly changing world, we at Omron understand that it is essential for us to always be seek-
ing out promising fields, areas, and technologies for our growth, rapidly reorganize and recombine our busi-
ness areas to accommodate selection and concentration of management resources, and grow our business. As
a powerful means of executing this strategy, we carefully consider the possibilities of M&A and proceed accord-
ingly. In this special feature, we present the strengthening and expanding of our businesses through M&A in six
case studies explaining initiatives to create synergies with existing businesses and to break into new growth areas
in the 2nd Stage of GD2010 from the perspective of long-term maximization of corporate value.
In addition to the need to pursue productivity at production
sites, there is a rapidly growing need to establish greater safe-
ty. Positioning the safety equipment business specializing in
safety at production sites as its top area of priority, the Industrial
Automation Business (IAB) has focused its efforts on strength-
ening its expertise in system solutions and consulting in safety
design know-how in addition to the manufacture of its wide-
ranging product lineup of safety equipment from components
to networks. As a result of its efforts, IAB has the largest share
of the safety equipment market for the Japanese and Asian
automobile and semiconductor industries.
Aiming for ambitious growth to further enhance our posi-
tion in the market, we acquired the safety equipment business
division of Scientific Technologies, Inc. a top manufacturer of
safety equipment in North America, in June 2006, and estab-
lished Omron Scientific Technologies, Inc (OSTI). OSTI has
strengths in safety equipment such as powerful, long-distance
safety light curtains and laser scanners and in North America
also boasts high technical expertise and brand power in the
food, pharmaceutical, and cosmetics industries as well as in
the automobile, semiconductor, and electronic machinery indus-
tries. Therefore, IAB plans to add OSTI’s safety devices to its
product lineup and to expand their application.
Moreover, the integration of IAB’s sensing and control
technologies and OSTI’s basic patents for optical application
technology and superior know-how in creating powerful devices
will boost IAB’s ability to respond to advanced safety needs
by reinforcing its expertise and pace of development.
As a result of these efforts, IAB’s safety equipment busi-
ness in fiscal 2008 is anticipating sales of ¥30 billion, which
represents a three-fold increase in sales from fiscal 2005.
Case 1: Aiming to be the global No. 1 company in safety equipment for the production site.
Target for Expanding the Safety Business of Omron Billions of yen
2005 2007
plan
2008
Target
10.0
15.1
22.0
30.0
2006
* OSTI has been in the scope of consolidation since September 2006
(FY)
Safety Laser Scanner
Safety Mat
Programmable Terminal
Safety Light
Curtain
Safety Network Controller
Guard Lock Safety-door Switch