Arrow aims at Japan

By Suzanne Deffree, News Editor -- Electronic News, 10/10/2007

Arrow Electronics Inc. today announced that it has established a Japanese subsidiary to conduct business for the first time in Japan.

In doing so, the electronics supply chain giant set up Arrow Electronics Japan, GK (Arrow Japan) and acquired all of the share capital of Universe Electron Corp. (UEC), a Tokyo-based distributor of semiconductor and multimedia products to Japanese manufacturers and firms, which will change its name to Arrow UEC Japan, KK.

While this is Arrow’s first full-fledged subsidiary in Japan, it is certainly not its first business endeavor there. In 1998, Arrow formed a 50-50 joint venture with Tokyo-based Marubun Corp. to serve Japanese customers who need support outside of Japan. Arrow later bought an interest in Marubun in 2001.  Today’s announcement will not end Arrow and Marubun’s relationship, as Arrow said the two companies will continue as partners in their joint venture and will continue to explore other joint activities following the launch of Arrow Japan.
 
Arrow Japan will primarily focus on leveraging Arrow's linecard and expanding the company's partnerships with small- and medium-sized customers in the region. Arrow's new subsidiary will further develop marketing relationships with existing customers as well as identify new growth opportunities, the Melville, N.Y.-based distributor said.

"The creation of Arrow Japan will allow us to strategically expand our components business into this significant $60 billion marketplace. With this transaction, we now have a solid foundation which we will use as a platform to grow our presence in this important region," William E. Mitchell, chairman, president and CEO of Arrow, said in a statement.

Arrow did not disclose financial information on its UEC acquisition or on its Japan subsidiary. Masaharu Shinya, chairman of UEC, will become chairman of Arrow Japan on November 1.

For more on the distribution market’s expanding presence in Japan, see “New markets, new problems.”