The announcement comes just days after loss-making Konica Minolta announced it would shed 2,400 jobs worldwide in order to achieve its financial goals.
In a joint statement announcing the plans, the two Japanese manufacturers said that the potential strategic alliance would optimise “procurement, toner development, and production efficiencies”, and that the market landscape for MFPs and printers “requires proactive measures”.
“The companies are also seeking to expand other business alliances and continue discussions.”
Fujifilm would hold a majority stake in the venture.
The initial focus would be on three areas: a business alliance for the procurement of raw materials and parts; an alliance covering toner development and production; and “other business alliances” covering strategic collaborations that will be addressed separately.
Naoki Hama, president and CEO of Fujifilm Business Innovation commented: “The ongoing discussions for this business alliance are of immense importance as we strive to strengthen our competitiveness and expand our global presence to make a significant leap forward.
“We are confident that this partnership will create a new framework to enhance our supply chain and build a robust business foundation.”
Konica Minolta president and CEO Toshimitsu Taiko said: “Sharing a common understating of the challenges facing the business, the two leading companies will be able to mutually maximize strengths through this alliance.
“I am looking forward to working together to improve investment efficiency and cost-competitiveness, strengthen capabilities for stable supply, environmental initiatives, and business continuity plans, and pursue the potential for enhancing business resilience as global manufacturers.”
The financial year-end for both firms is the same, 31 March.
The “tentative timeline” for the establishment of the JV is the second quarter of financial year 2024, so the July-September period.
Fujifilm is much bigger than KM, posting sales of ¥2,859bn (£14.86bn) in the last financial year ending March 2023, and, crucially, Fujifilm is profitable. The overall group posted operating profits up nearly 19% at ¥273.1bn.
Fujifilm Business Innovation is the former Fuji Xerox operation, which changed its name in 2021 after Fujifilm and Xerox parted ways. It includes office and business solutions and had sales of just over ¥838bn and operating profits grew by 20% to ¥69.5bn.
Fujifilm’s separate Materials division includes its Graphic Communication wing, that incorporates digital printing and inkjet.
KM posted sales up 24% in the financial year ending 31 March 2023 at ¥1,130bn but its operating losses more than quadrupled, to ¥95,125m.
It has posted losses at the operating level since FY21 and is expected to do so again in the financial year just completed.
Fujifilm is very much on the front foot pushing its own-brand range of production toner and inkjet printers for the commercial and large-format markets. It is poised to hold an event marking its entry in the European office printer market at the end of this month.
Commenting on the news, managed print and IT veteran and consultant Ray Stasieczko, host of ‘the end of the day with Ray’ on YouTube, described KM’s losses as “a train wreck”.
He said: “The OEMS have got to do something. I believe we’ll see other OEMs joining in the fun.”
He noted that the likely alliance would be low-risk for Fujifilm.
Stasieczko also said he believed the Master Trust Bank of Japan, which is a big shareholder in both organisations, was the driving force behind the announcement.
ExedraBridge founder and partner Chris Jordan told Printweek the second half of 2024 had the potential to be “a very painful blood bath” and stated: “This will be a watershed year for many.”
Both firms have a sizeable presence at the upcoming Drupa show, and are in the same hall – Hall 8b – and where Fujifilm has taken on additional space after Xerox decided not to exhibit.
Earlier this year Konica Minolta announced it would reorganise into three business segments: Business Technologies (digital workplace, professional print and chemical products); Industrial Business (including sensing, optical components, inkjet components and performance materials); and Imaging Solution Business (healthcare medical imaging, imaging-i-o-t solutions, visual solutions, FORXAI, and QOL solutions).
