||Merger Message to Shareholders and the Investment Community
Takara Co., Ltd. and TOMY Co., Ltd. have merged, effective March 1, 2006.With a mutual respect for each other’s history and corporate culture, under the common vision of bringing dreams to children throughout the world, the new company is called TOMY Company, Ltd. and is known in Japanese as Kabushiki Kaisha TAKARATOMY.
By integrating the core toy businesses of both companies we expect to reinforce each other’s product development and marketing capabilities, better utilize existing content and increase our capacity to develop new content, thereby expanding our toy and entertainment business.We further expect to reduce costs and increase efficiency in a wide range of operations including production, logistics, sales and administration.Through these synergies, we are confident that we can significantly increase corporate profitability and in turn corporate and shareholder value.
Toys are a medium for play, for creativity and for a host of other meaningful childhood experiences and such experiences play an important role in healthy child development.Therefore we are proud to be entrusted with the mission to help shape our children’s future through toys.To ensure that toys continue to meet this important need, the new TOMY plans to revitalize the toy industry with an emphasis on the key concept of “Toy Renaissance” distributing high quality toys globally, recognizing that well-designed toys contribute towards development of education, culture, science and ultimately peace.
For the new TOMY the “Toy Renaissance” concept means (1) Practicing “selective destruction” to eliminate the inefficiencies while adopting the strengths of Takara and TOMY. (2) The creation and expansion of new content by blending toys and digital media and (3) Using our new business model to revitalize the toy industry.TOMY will pursue these efforts while keeping toys as its core business and expanding its presence globally.These fundamental changes will jump-start TOMY’s global potential, realizing steady value creation and a rebirth of our company.
Declining birth rates in Japan, the rise of information technology and globalization will have a great impact on the domestic toy industry. Yet the growing global popularity of characters, animation and general content originating in Japan is opening up great new opportunities for TOMY.By creating toys and content for children and people of all ages in Japan, then introducing them globally, we will become a company with a business model for growth while delivering dreams and emotions to the world.
As always, we ask for your continued trust and support.
Kantaro Tomiyama, President
Keita Satoh, Executive Vice President