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(Nikkei BP Group)

(No.1 High-Tech News Site in Japanese)

  • Oracle Japan to Register for Over-the-Counter Market
  • January 22, 1999 (TOKYO) — Oracle Corp. Japan is scheduled to register for the over-the-counter market in Japan on Feb. 5.
    It is rare for a Japanese subsidiary of a major U.S. information technology vender to publicly offer stock in Japan.

    Its aim is to deeply root itself in the Japanese market to expand business.

    Chikara Sano, president of Oracle Japan since October 1990, has repeatedly expressed his intention for a public offering. “We aim to take root in Japan,” he said. “Oracle Japan wishes to become one of Japan’s assets.”

    The biggest target for Oracle Japan’s IPO is to become a company close to the Japanese market. Corporate users, partner companies with Oracle, can purchase stock. That will help Oracle construct close relationships with them.

    In general, Japanese subsidiaries of U.S. companies tend to follow the intentions and directions of their parent headquarters. Having Japanese corporate stockholders may change that to some degree.

    “No matter how significant the sales are that we achieve, it means nothing if a Japanese subsidiary is like a regional office dependent on the parent company’s intent,” Sano said.

    The IPO also aims to bring dividends to the parent company, Oracle Corp., and to Oracle Japan employees with stock options.

    However, Oracle Japan’s IPO might hamper parent Oracle in trying to orchestrate its moves in the market. For that reason, most U.S. IT vendors are not enthusiastic about letting their overseas subsidiaries go public.

    IBM Corp. and Microsoft Corp., both of the United States, have no plans to let their Japanese subsidiaries go public. Nihon Unisys Ltd. is a listed company on the Tokyo Stock Exchange, but this is an exceptional case because Nihon Unisys started as a joint venture with Mitsui & Co., Ltd.

    For its globalization, NCR Corp. of the United States took a plunge in 1998 to convert already listed NCR Japan Ltd. into a 100 percent subsidiary.

    Oracle Corp. is promoting its corporate vision of “all Oracles worldwide are one company.” Executives at the U.S. parent reportedly voiced the need to take a careful step, because there are few cases of public offerings determined by overseas subsidiaries.

    According to an informed source, Sano was in direct talks with Larry Ellison, chairman and CEO of Oracle Corp., for approval of the public offering.

    “Globalization means deep penetration to each of the region a company is serving,” Sano said of any potential conflicts between strategies of a localized Japanese subsidiary and the U.S. parent.

    “Oracle Japan’s taking root in Japan and Oracle Corp.’s globalization do not go against each other,” he added.

    Conducting a business that brings profits to both Oracle’s parent company and the companies with Oracle Japan’s stock will be feasible. However, Oracle Japan will need to come up with original corporate strategies while keeping its mission to expand sales of packaged software developed by its U.S. parent.

    (Nikkei Computer)

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