Arrow Buys Interest In Marubun

By Rob Spiegel, Electronic News -- 5/30/2001

Arrow Electronics of Melville, N.Y., has purchased 5.2 percent of the outstanding shares of Marubun Corp., a  Tokyo-based electronic components distributor.

Arrow bought the Marubun shares from several financial institutions in a series of privately-negotiated transactions. Arrow representatives characterized the investment as a move to strengthen the strategic partnership between the two companies that began three years ago when they formed Marubun/Arrow to serve Japanese customers with manufacturing facilities in North America and the Asia/Pacific region.

The investment takes Arrow (nyse: ARW) deeper into the Japanese market.

"I think Arrow is trying to get a stronger foothold in Japan and probably the best way to do it is by getting an interest in a Japanese company," said George Perris, founder and president of Sierra Marketing Group in Rocklin, Calif.  "Japanese customers will be more likely to buy from a Japanese company even if it is partially owned by a global U.S. company, so it's certainly a great strategic move for Arrow. If Arrow opened a Japanese facility of its own, I don't think they'd be successful."

Marubun closed 2000 with $1.5 billion in sales. The company is the largest non-affiliated franchised distributor of electronics and supply chain services in Japan. The company has almost 1,000 employees and its stock is traded on the Tokyo Stock Exchange.

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