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Sumitomo Corporation

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Not to be confused with Sumitomo Group.

Sumitomo Corporation
Native name
住友商事株式会社
Sumitomo Shōji kabushiki gaisha
Company typePublic KK
IndustryGeneral trading
Founded24 December 1919; 104 years ago (1919-12-24)
Osaka, Japan
HeadquartersEast Tower 3-2 Otemachi 2-chome, Chiyoda-ku, Tokyo, Tokyo 100-8601, Japan
Area served
Worldwide
Key people
Kazuo Ohmori
(Chairman)
Masayuki Hyodo
(President, and Chief Executive Officer)
ServicesMetal
Construction
Transportation
Infrastructure
Chemicals
Energy
Mineral resources
Food
Consumer Goods
RevenueIncrease$ 32.16 billion USD (FY 2013) (¥ 3,317 billion JPY) (FY 2013)
Decrease$ 2.16 billion USD (FY 2013) (¥ 220.06 billion JPY) (FY 2019)
Number of employees
72,642 (consolidated as of March 31, 2020)
SubsidiariesSCSK
TBC Corporation (50%)
WebsiteOfficial website
Footnotes / references
[1][2][3]

Sumitomo Corporation (Japanese: 住友商事株式会社, Hepburn: Sumitomo Shōji kabushiki gaisha) is one of the largest worldwide sogo shosha general trading companies, and is a diversified corporation. The company was incorporated in 1919 and is a member company of the Sumitomo Group.

It is listed on three Japanese stock exchanges (Tokyo, Nagoya and Fukuoka) and is a constituent of the TOPIX and Nikkei 225 stock indices.[4][5] Today, the company is one of the top three sōgō shōsha companies in the world.

History

The Sumitomo Group, of which Sumitomo Corporation is a key member, dates to the 17th century establishment of a book and medicine shop in Kyoto by Masatomo Sumitomo. Sumitomo's brother-in-law Riemon Soga developed a technology to extract silver from copper, and Soga's son (who married Sumitomo's daughter) Tomomochi Sumitomo expanded this smelting business to Osaka. From this start, the Sumitomo family expanded its business into copper mining (the Besshi copper mine), followed by textiles, sugar and medicine trading.[6]

The Sumitomo family was close to the Tokugawa shogunate throughout the Edo period. During the 1860s, this relationship became a liability for the firm as the Tokugawa clan warred with rivals in western Japan. Following the Tokugawas' defeat, Sumitomo was almost ruined and under pressure to sell the Besshi mine, which by that point was nearly unworkable. However, Sumitomo kept the mine and improved its output through adoption of new Western techniques.[7] During the rapid westernization of Japan in ensuing decades, Sumitomo started various new trading, manufacturing and financing businesses, becoming one of the major zaibatsu of early 20th century Japan.[6]

Sumitomo Corporation was incorporated in December 1919 as The Osaka North Harbour Co., Ltd. to engage in real estate management, land reclamation, land grading, harbor repair construction and related work in the Osaka northern harbor region. In 1944, the company merged with Sumitomo Building Co., Ltd. (established August 1923; capital stock 6.5 million yen) to form Sumitomo Building and Real Estate Co., Ltd.[8]

World War II destroyed most of Sumitomo's industrial infrastructure within Japan, and the ensuing Allied occupation led to the forced breakup of the largest Japanese companies, including Sumitomo.[7] Sumitomo Building transitioned to general trading, looking to handle products from Japan's major manufacturing firms in various industries, and changed its name to Nippon Engineering Co., Ltd. (Nihon Kensetsu Sangyo Kaisha), starting a new existence as a general trading firm with a sales staff of just 32 people. The firm listed its shares on the Osaka, Tokyo and Nagoya Stock Exchanges in 1949.[6][8]

As regulations on large companies were relaxed in the 1950s, Nippon Engineering resumed closer relations with other Sumitomo Group companies through the "White Water Club" (Hakusui-kai), a coordinating meeting of company presidents.[7] The company began to grow overseas in the 1950s, starting business in Mumbai in 1950 and in New York City in 1952. It changed its name to Sumitomo Shoji Kaisha, Ltd. in 1952. By the 1960s Sumitomo officially aimed to be one of the "Big Three" general trading companies, alongside Mitsubishi and Mitsui. In 1970, Sumitomo established a second head office in Tokyo and merged with Sogo Boeki Co., Ltd. Sumitomo adopted its current English name, Sumitomo Corporation, in 1978.[8] The company's transactional volume increased by a factor of ten from 1955 to 1965, and again by a factor of ten from 1965 to 1975. Like its zaibatsu cohorts Mitsubishi and Mitsui, Sumitomo established a keiretsu business group centered on itself and Sumitomo Bank.[7]

Sumitomo's strategy focused on natural resources through 2014, when the company booked hundreds of billions of yen in losses on tight oil (shale oil) and other energy-related investments. The company's president, Kuniharu Nakamura, attributed these losses to both adverse market factors and Sumitomo's relative inexperience in the field. As a result of these setbacks, Sumitomo was overtaken by Itochu as Japan's third-largest general trading company. Sumitomo announced in 2015 that it would refocus its business on the automotive and infrastructure industries and other non-resource businesses.[9]

Berkshire Hathaway acquired over 5% of the stock in the company, along with four other Japanese trading houses, over the 12-month period ending in August 2020.[10]

Projects and investments

One of Sumitomo's largest investments is in the Ambatovy nickel mining project in Madagascar, where it had invested approximately $2.4 billion as of 2015 in a joint venture with Korea Resources and others.[11]

Sumitomo is a 50% investor in SES Water, a UK water supply company, together with Osaka Gas.[12]

Sumitomo is a major investor in the Turo car-rental service, and plans to facilitate the service's debut in Japan around 2020.[13]

Sumitomo, along with Mitsubishi Heavy Industries, is working with the Philippine Department of Transportation for the rehabilitation of the MRT Line 3 in Manila, Philippines since 2019. Sumitomo previously maintained the line from 2000 to 2012, until the line was seen to be deteriorated in the following years due to poor maintenance.[14]

Sumitomo is in a joint venture with the Japan Transport Engineering Company (J-TREC) for the production of a total of 51 commuter train sets (408 cars) in two separate contracts for the Philippine National Railways North-South Commuter Railway[15][16] and the production of 30 8-car train sets (240 train cars) for the Metro Manila Subway.[17]

Sumitomo is an investor in the Light Rail Manila Corporation, a railway consortium composed of Metro Pacific Investments Corporation, Ayala Corporation, and Macquarie Infrastructure Holdings (Philippines) PTE Ltd. since May 2020. LRMC is currently operating the LRT Line 1 in Manila, Philippines. It is the first investment of Sumitomo in a railway business in Southeast Asia.[18][19]

Subsidiaries

  • Aimo Park[20]
  • Aimo Solution[21]
  • Bluewell Insurance
  • Cantex
  • Clickstream Capital
  • Global Partnership for Ethiopia (27.20% share)
  • Pacific Summit Energy
  • Petro Summit Pte Ltd (Singapore)
  • Presidio Ventures
  • SCSK
  • SMBC Finance & Lease
  • Sumitomo Corporation Equity Asia Limited
  • Sumitomo Wiring Systems Ltd.
  • Sumitomo Corporation Global Commodities (London & Singapore)
  • Sumitec International (Moscow)
  • Summit Biotech
  • TBC Corporation (50% share) (Tire Kingdom, NTB, Big O Tires, Midas International, LLC.)
  • Pet product maker Hartz Mountain Corporation was acquired from J.W. Childs in 2004, but 51% was sold to Unicharm in December 2011.|C
  • Crunchyroll SC Anime Fund (anime production joint venture with Crunchyroll)[22]
  • Sumitomo Chemical Company Limited[23]
  • Sumitomo Forestry NZ Limited[24]
  • Summit Fresh Foods New Zealand Limited[25]
  • Summit Forests New Zealand Limited[26]
  • New Zealand Aluminium Smelters Limited (20.64% share)[26]
  • Kiriu Corporation

Shareholders

References

  1. ^ "Corporate Profile". Sumitomo Corporation. Retrieved 26 September 2014.
  2. ^ "Company Profile". Bloomberg L.P. Retrieved 26 September 2014.
  3. ^ "Company Financials". Bloomberg Businessweek. Retrieved 26 September 2014.
  4. ^ "TOPIX Core30 Components" (PDF). Japan Exchange Group. Archived from the original (PDF) on 13 May 2014. Retrieved 26 September 2014.
  5. ^ "Components:Nikkei Stock Average". Nikkei Inc. Retrieved 25 September 2014.
  6. ^ a b c "Sumitomo History". Sumitomo Corporation. Retrieved 26 January 2015.
  7. ^ a b c d "History of Sumitomo Corporation". Reference for Business. Retrieved 26 January 2015.
  8. ^ a b c "Sumitomo History". Sumitomo Corporation. Retrieved 26 January 2015.
  9. ^ "Getting burned in resources, Sumitomo changes tack". Nikkei Asian Review. 26 March 2015. Retrieved 27 March 2015.
  10. ^ "Warren Buffett takes 5% stake in 5 Japanese trading companies". Nikkei Asian Review. 31 August 2020. Retrieved 31 August 2020.
  11. ^ Fukase, Atsuko (16 October 2015). "Sumitomo Faces Possible Loss on Nickel Project". Wall Street Journal. ISSN 0099-9660. Retrieved 26 July 2018.
  12. ^ "Sumitomo Sells Half of U.K. Water Supply Holding to Osaka Gas". www.bloomberg.com. 30 September 2013. Retrieved 26 July 2018.
  13. ^ Nakanishi, Toyoki (18 April 2018). "US car-sharing app teams with Sumitomo for drive into Asia". Nikkei Asian Review. Retrieved 26 July 2018.
  14. ^ Sumitomo Corporation; Mitsubishi Heavy Industries Engineering, Ltd. (7 January 2019). "Order Received from the Philippines for Rehabilitation and Maintenance of Manila MRT-3". Retrieved 21 October 2021.
  15. ^ "Order Received to Supply 104 Train Cars for Philippines' North-South Commuter Railway Project". Sumitomo Corporation. 16 July 2019. Retrieved 21 October 2021.
  16. ^ "Order Received to Supply 304 for the Philippines' North-South Commuter Railway Extension Project". Sumitomo Corporation. 18 March 2022. Archived from the original on 20 March 2022. Retrieved 20 March 2022.
  17. ^ "Order Received to Supply 240 Train Cars for Philippines' Metro Manila Subway". Sumitomo Corporation. 21 December 2020. Retrieved 21 October 2021.
  18. ^ "Japan's Sumitomo joins Pangilinan-Ayala consortium for LRT-1". ABS-CBN News. 29 May 2020. Retrieved 4 December 2021.
  19. ^ "Investment in LRT-1 Operator in Manila, the Philippines". Sumitomo Corporation. 29 May 2020. Retrieved 4 December 2021.
  20. ^ "Q-Park becomes Aimo Park".
  21. ^ "Acquisition of a Leading Parking Provider in Sweden, Norway and Finland".
  22. ^ "Crunchyroll and Sumitomo Corporation nnounce Partnership to Create Company to Co-Produce Anime". Anime News Network.
  23. ^ "Shareholdings". app.companiesoffice.govt.nz. Retrieved 2 September 2019.
  24. ^ "Shareholdings". app.companiesoffice.govt.nz. Retrieved 2 September 2019.
  25. ^ "View All Details". app.companiesoffice.govt.nz. Retrieved 2 September 2019.
  26. ^ a b "View All Details". app.companiesoffice.govt.nz. Retrieved 2 September 2019.

Trading

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