NSG Group to Post Extraordinary Charge in FY2009 on Sale of Telecommunication Device Division
Nippon Sheet Glass Co., Ltd. (“the Company”) announces that it has today decided to sell its Telecommunication Device Division (as defined below). The transaction gives rise to an extraordinary charge for the year ending 31 March 2009, already reflected in the Group's results for the period announced today.
1. Reasons for the transaction
The Telecommunication Device Division (part of the Company's Specialty Glass business), which supplies the optical telecommunications market, has been incurring losses, leading the Company to study the possibility of exiting or selling it. The objectives of the proposed sale are to eliminate those losses and to allow the Company to concentrate its management resources on its core businesses.
It is important to note that the assets involved in this sale do not include the Company's Information Device business, which supplies the markets for printers, scanners and other equipment, or the Company's proprietary SELFOC® Micro Lens (SML) technology.
However under the agreement the Company will supply to the buyer SML components, to be used in products to be manufactured by the buyer. The company will also supply the buyer with finished SML products, for which the buyer will act as a distributor.
2. Details of the transaction
(1) Details of the assets to be transferred
- Manufacturing facilities and trade rights for optical component and module products for the optical telecommunications market
- Manufacturing facilities and trade rights for photo diode-based products for the optical telecommunications market
(2) Sale Proceeds
The sale proceeds are not expected to be material to the Group.
(3) Timing
The Company is negotiating with a potential buyer and the closing date is scheduled to take place in June 2009.
3. Impact on the operation
The Company has recognized a consequent extraordinary charge on a non-consolidated basis of JPY 0.8 billion and on a consolidated basis of JPY 1.2 billion in its result for the fiscal year ended 31 March 2009. The charge includes a loss on the sale of assets owned by the Company.