Nissan Motor Co. confirmed Monday that it has agreed to sell its aerospace and defense division to Ishikawajima-Harima Heavy Industries Co. as part of its streamlining efforts.
The two firms will decide on the cost of the deal, the number of employees involved and other details by the end of July, a Nissan spokesman said.
Nissan has been developing and manufacturing rockets since 1953, including the M-5 rocket that failed to put an astronomical observation satellite into orbit last week.
As of the end of January, the Nissan unit employed 920 people, mainly at a plant in Tomioka, Gunma Prefecture. It posted 51 billion yen in sales in fiscal 1998.
An IHI spokesman said the proposed deal would help enhance IHI’s aerospace and defense division since the two firms complement one another. Nissan’s rockets, for example, are based primarily on solid-fuel propellants, while IHI’s vehicles use liquid fuel.
Most of Nissan’s defense contracts are with the Ground Self Defense Force, whereas IHI’s main customers are the Air Self Defense Force and the Maritime Self Defense Force, the IHI spokesman said.
The proposed sale is part of Nissan’s effort to concentrate its corporate resources on its core automotive business under the so-called Revival Plan announced last. In addition to the aerospace and defense division, Nissan manufactures boats and industrial machinery.
Led by Chief Operating Officer Carlos Ghosn, Nissan is hoping the restructuring program will halve its interest-bearing liabilities to 700 billion yen by fiscal 2002 and return the company to profitability in fiscal 2000.
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