Two major auto parts makers in the Nissan Motor group formally signed an agreement Tuesday to merge on April 1, company officials said.
Calsonic Corp. and Kansei Corp. will swap shares 1 for 1 to create the largest auto parts maker in the Nissan group in terms of sales, exceeding Unisia Jecs Corp., which posted 185 billion yen for fiscal 1998.
The two companies announced their basic agreement to merge in March, but the share-swapping ratio had not been decided.
Calsonic will be the surviving company. Calsonic President Haruo Ohno will be chairman of the new company and Kansei President Koichi Takagi will be president.
But tentatively named Calsonic-Kansei is expected to face tough competition as Nissan Motor reviews its auto parts procurement in the wake of its alliance with Renault SA of France.
The merger is aimed at combining resources for development of key technologies, such as module parts and intelligent transport systems, company officials said.
ITS refers to integration of information technology to control auto functions and traffic flow, such as wireless toll collection systems and navigation systems to help drivers.