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Mr. Jun Sawada (left), President of NTT, and Mr. Kazuhiro Yoshizawa (right), President of NTT Docomo
NTT (holding) and NTT Docomo announced that they will implement a TOB (Offer to Purchase) to make Docomo a wholly owned subsidiary. It also announced that it has reorganized the NTT Group and has begun considering incorporating NTT Communications and NTT Comware into the NTT Docomo Group.
At the meeting, Mr. Jun Sawada, President of NTT, and Mr. Kazuhiro Yoshizawa, President of NTT Docomo, took the stage.
It became a comprehensive ICT company by accelerating decision making and reorganizing the NTT Group.
Mr. Jun Sawada, President and CEO of NTT
NTT’s Mr. Sawada captured changes in the environment surrounding the information and communication market and changes in social trends, and analyzed that “dynamic environmental changes are occurring globally”.
In response to the rapid expansion of remote work due to the new coronavirus infection, the company will provide new services, centralize resources, promote research and development, and strengthen the creation of new businesses such as the smart life business.
He said it was essential to strategically use resources and assets across the group and accelerate decision making.
Therefore, NTT will make Docomo a wholly owned subsidiary to accelerate the decision-making of the Docomo Group.
Additionally, we are considering reorganizing NTT Communications and NTT Comware into the Docomo Group in the future. In addition to integrating existing services from Docomo, NTT Communications, and NTT Comware, our goal is to use the capabilities of NTT Communications and NTT Comware to evolve into a comprehensive ICT business that integrates mobility and fixation into the creation of new services. politics.
TOB scale exceeds 4 trillion yen
In order for NTT to convert Docomo into a wholly owned subsidiary, a public tender offer (TOB) for the shares of Docomo will be implemented. The purchase period is from September 30 to November 16, the purchase price is 3,900 yen per share, and the planned number of purchases is 1,090,896,056 shares. The scale of the purchase is projected to be approximately 4.3 trillion yen.
Even if TOB is unable to acquire all of the DoCoMo shares, the policy is to complete the acquisition of the DoCoMo shares by the end of fiscal 2020 according to other procedures.
NTT DATA has no plans to turn it into a wholly owned subsidiary.
Docomo needs a transformation to expand its business domain from the mobile approach
Mr. Kazuhiro Yoshizawa, President and CEO of NTT Docomo
Then Kazuhiro Yoshizawa, President and CEO of NTT Docomo, explained the need for Docomo transformation.
According to Mr. Yoshizawa, competition in the telecommunications business is intensifying and competition with players from different industries such as GAFA is accelerating. Furthermore, the market environment is changing dramatically due to changes in society, diversification, sophistication and complexity of user needs.
In today’s 5G era, as society drastically shifts to the remote type, DoCoMo needs to expand its business domain from the mobile hub and make changes so that it can fully meet the needs of users.
For this reason, DoCoMo will become a wholly owned subsidiary of NTT, and the group will be reorganized with NTT Communications and NTT Comware, with the aim of becoming a company that can meet the needs of users with full services such as “front to all users “. ..
Specifically, by using group management resources, we will perform network services that integrate mobile, fixed and Wi-Fi, and we will perform optimization and sophistication of networks to strengthen cost competitiveness.
He also mentioned the strengthening of the corporate business and the smart life business, and the strengthening of the research and development system for next-generation networks such as 6G and IOWN.
From now on to become a wholly owned subsidiary
According to NTT’s Mr. Sawada, NTT has been discussing future policies for several years and the policy was finalized in April of this year. Also, DoCoMo is said to have had a consultation in June.
In the future, NTT Communications and NTT Comware will be shipped to the NTT Docomo Group, but they are not considering whether to incorporate them into NTT Docomo. Competition in the market is said to have been changing in the form of a merger of fixed and mobile, and compared to KDDI and Softbank, it is said to have lagged behind in developing services that combine fixed and mobile.
Furthermore, in response to the question that other companies may criticize or become a market monopoly due to the group reorganization, NTT’s Mr. Sawada has legal restrictions on cooperation with “NTT East and West”, but Docomo and NTT Communications There are no laws or regulations regarding these matters. Regarding the NTT network, which is the backbone of mobile lines, he said that it also sells wholesale lines to KDDI and Softbank under the same conditions as Docomo, and commented that Docomo’s share is currently around 40% and it is not in a dominant market situation. ..
It also acknowledged that there are no legal issues regarding the acquisition of DoCoMo as a wholly owned subsidiary and the collaboration between NTT Communications and NTT Comware.
NTT’s Mr. Sawada said that the reorganization of the NTT Group would achieve optimization of resources and stabilization of the administrative base of DoCoMo, and said that stabilizing the administrative base would eventually lead to a reduction in service charges.
He also commented that the future of Docomo is “to be a comprehensive ICT company that can provide good and cheap services, compete in the market and carry out research and development.”
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