Hitachi Ltd. plans to further reduce its stake in Hitachi Construction Machinery, according to a November 4 share transfer statement.
Upon completion of the share transfer, Hitachi's voting rights ownership ratio in Hitachi Construction Machinery will drop from 25.4% to 18.4%. Hitachi Construction Machinery will also no longer be an equity-method affiliate of Hitachi Ltd.
Hitachi Ltd. has been slowly separating itself from its construction unit. The parent company sold half of its 51% stake in Hitachi Construction Machinery to trading firm Itochu Corp. and investment fund Japan Industrial Partners in 2022, citing a strategic shift away from traditional manufacturing and toward digital businesses. It also hinted at divesting all or part of its interests in Hitachi Construction Machinery in March 2019 and again in October 2020.
The recent selloff came shortly after Hitachi Construction Machinery announced that it would rebrand as “Landcros” in 2027. Hitachi Ltd. says the move affords the construction unit more “independent and self-reliant management” and allows it to expand its shareholder base.
Despite the change, Hitachi Ltd. says it will remain an important business partner to Hitachi Construction Machinery and will continue its cooperative relationship in areas such as the utilization of digital and autonomous driving technologies, electrification and parts supply.
According to the announcement, the change will have no impact on Hitachi Construction Machinery’s performance.
