CalComp Sells Subsidiary to Boost Japan Market Share

CalComp Inc. said Wednesday it has sold a majority interest in its Japanese marketing subsidiary to two major Japanese corporations in order to increase sales of its computer graphics products in that country.

William P. Conlin, CalComp president, said in an interview that the sale of 56% of Nippon CalComp to Nippon Steel Corp. and Sumitomo Corp. was the only way ensure that the company would gain access to the entire Japanese marketplace.

“We’ve been satisfied with the growth rate of our subsidiary in Japan, which has been around 20% to 25% a year for the past few years,” Conlin said.

Conlin said CalComp doesn’t do as well in the Japanese market as it does in other international markets.

“We have a lot of strong local competition in Japan, which is not true elsewhere, and in Japan you just don’t get total access to the market if you are not a Japanese (owned) company. We wanted to have a subsidiary that was Japanese.”

The subsidiary, now called NS CalComp, had less than 5% of the estimated $750-million annual market for computer graphics equipment in Japan, Conlin said, while CalComp, with about $450 million in sales last year, has about 10% of the U.S. market.

CalComp, a Lockheed Corp. subsidiary, will realize a $20-million gain from the sale. Nippon Steel bought 51% of the marketing while Sumitomo’s trading company subsidiary bought a 5% interest.

NS CalComp will market, service and support CalComp’s plotters, digitizers and graphic display products, which are used in a wide range of computer-aided design, presentation graphics and graphic arts applications.

As part of the joint venture, new products designed specifically for the Japanese market will be developed jointly by CalComp and Nippon Steel’s Electronics & Information Systems Division, Conlin said.