Hokuetsu Kishu Paper Co. has no plans to merge with Daio Paper Corp. anytime soon, the president of Hokuetsu, the fifth-largest paper-maker in Japan, said in a recent interview.
Hokuetsu has a stake of over 20 percent in Daio, the fourth-biggest paper-maker.
Hokuetsu President Sekio Kishimoto explained that Daio has large debts and is still influenced strongly by its founding family.
“Our basic stance is that we will not merge unless such problems are solved,” Kishimoto said, adding that his company continues to urge Daio to improve its financial performance.
Hokuetsu is expected to see its paper production and sales double in 2015 from levels before the global financial crisis of 2008.
Kishimoto emphasized that his company is capable of surviving and growing by itself.
Hokuetsu will not rush to create a third force in the Japanese paper industry, behind Oji Holdings Corp. and Nippon Paper Industries Co., he said, describing this as “an additional scenario.”
Kishimoto said that despite shrinking demand, the number of players in the domestic paper industry is unlikely to fall if major companies focus on their strengths and become nongeneral paper makers.
Kishimoto said Hokuetsu plans to invest ¥30 billion to ¥40 billion over three years in order to expand overseas. The company is considering purchasing a specialty paper manufacturer in North America, he added.