Hitachi Soe Electric & Machinery Begins Operations

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The FINANCIAL — Hitachi Industrial Equipment Systems Co., Ltd. and Soe Electric & Machinery Co., Ltd. completed a formal contract on July 7, 2015, for the establishment of Hitachi Soe Electric & Machinery Co., Ltd., a joint venture company handling transformers for power systems and power distribution in the Republic of the Union of Myanmar. Authorizations have been obtained from the relevant authorities, and business operations at Hitachi SEM begin on October 1.

HIES and SEM have been involved in technical collaborations related to amorphous transformers*1 since 2012, and have formed a cooperative relationship in the field of engineering. They agreed to establish the joint venture company in order to further strengthen this collaborative relationship. Hitachi SEM takes over SEM’s transformer business as of today, and will undertake the design, manufacture, sales, installation, and maintenance of power transmission and distribution equipment in Myanmar, with a particular focus on transformers for power system and power distribution applications, according to Hitachi.

The electric power demand in Myanmar has been increasing rapidly in the backdrop of economic development in recent years, and it is considered a major issue to establish power infrastructures to support this demand. Because power shortages are a serious hindrance to industrial development, Myanmar is currently focusing efforts on putting in place power generation facilities as well as power transmission and distribution networks. This has led to an increased demand for power transformation and distribution facilities, including high-quality transformers that support the stable supply of electric power.

Through establishing Hitachi SEM, HIES and SEM will combine SEM’s strong business base in Myanmar with HIES’s transformer design and manufacturing technologies to enhance the product lineup and expand market share by further strengthening the business, while at the same time promoting the rollout of export business targeting ASEAN countries close to Myanmar. In addition, by enhancing design and manufacturing capabilities for power transformers, they will strive to increase the ratio of local production in Myanmar for these transformer products, many of which are currently being imported from overseas.

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HIES and SEM will contribute to putting in place reliable electric power infrastructures in Myanmar through Hitachi SEM.

Comments from Kyaw Min Htun, Vice Chairman, Hitachi SEM

“Myanmar is currently in the midst of rapid economic growth, and the implementation of power system infrastructures, which will serve as a base for that growth, has become an urgent issue. By incorporating Hitachi’s technologies and extensive experience into SEM’s strong business base in Myanmar, we will accelerate contributions to Myanmar’s power system infrastructures and industrial development. Furthermore, this joint venture company will contribute to fostering human resources in Myanmar, by providing promising Burmese manpower, who in the past had tended to leave for other countries, with opportunities to become involved in cutting-edge technologies and management within Myanmar.”

Comments from Katsutoshi Inagaki, Managing Director, Hitachi SEM

“I am extremely pleased that Hitachi SEM began its business operations today. The Hitachi Group has been handling transformers and other power transmission and distribution equipment for many years, contributing to the maintenance and development of power system infrastructures not only in Japan, but in countries throughout the world. SEM, meanwhile, boasts overwhelming experience and trust as a top level transformer manufacturer in Myanmar. Through this joint venture company, we will combine the strengths of both companies to support the implementation of power system infrastructures in Myanmar and surrounding countries, where demand is expected to increase rapidly in the future.”


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