HIROYUKI KOBAYASHI and YUSUKE HINATA, Nikkei staff writers
DMG Mori machine tools.
NAGOYA -- Japan's DMG Mori has stepped up ties with a German subsidiary, removing barriers to the mutual development of next-generation networked manufacturing technology.
The machine tool maker said Thursday that it raised its stake in the German company sharing its name from 60.67% to 76.03% in a share acquisition worth nearly 63 billion yen ($581 million) based on the latter's Wednesday close in Frankfurt. The subsidiary brought in 2.3 billion euros ($2.61 billion) in 2015 selling machine tools to European automakers and others.
The duo entered a capital tie-up in 2009 and the Japanese company has steadily grown its stake since. The latest move is intended to "enhance the integration" of the German unit, the parent said.
Under German law, DMG Mori's 60.67% stake in its subsidiary was insufficient to allow information, technology and other resources to be shared without formal agreements certifying the subsidiary would not be put at a disadvantage. The duo's ability to rotate staff between their two technology divisions was also limited.
Those restrictions can be removed with the approval of shareholders representing more than 75% of the voting rights at the German company's general shareholders meeting. The increased stake will thus let the two companies boost technological exchange.
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The move is aimed in particular at cooperation on technology related to the so-called Internet of Things, including networked production machines capable of interacting with one another and methods of instantaneously adjusting planned output in response to consumption. Germany is a leader in the field. Japan, meanwhile, is known for high-precision manufacturing. Combining, for example, heat sensors and networking software with machine tools would draw on both of those strengths.
Making products "cheap isn't enough to get them to sell," President Masahiko Mori of the Japanese company said. DMG Mori will thus make an all-out effort to make its offerings part of the Internet of Things, he said, growing the company's cache with automakers and others looking to implement the technology in factories.
Once networked production technology catches on, machine makers sticking to conventional methods will be left behind. Companies will "eventually be unable to meet customers' needs on their own," Satoshi Takeda of Mitsubishi Electric's factory automation systems division said, stressing the need for tighter cooperation across industry and national lines.
Machine tool maker Yamazaki Mazak and Cisco Systems of the U.S. have developed a device letting machine tools network for central control. Japan's Fanuc last summer took a stake in Preferred Networks, a startup involved in analyzing data from industrial robots and machine tools to determine more efficient modes of operation.
In Germany, meanwhile, the government is working with industrial electronics giant Siemens, software provider SAP and others to usher in a new age of networked manufacturing. Japan will need to keep up if it is to remain a global industrial leader.
