Nippon Chutetsukan has signed the agreements that would move its straight ductile iron pipe production into a new company part-owned by Kubota. The company split is planned to take effect on January 4, 2027, and it is conditional on shareholder approval.
The ownership split
The board approved an absorption-type company split on October 5, 2026, and the parties signed the split agreement the same day, along with a memorandum with Kubota on the venture. The new company, set up on June 10, 2026 as a wholly owned subsidiary, will take over the straight-pipe business. After the split takes effect, Nippon Chutetsukan will sell 19.9% of the new company's shares to Kubota, leaving it with 80.1%.
Nippon Chutetsukan expects to nominate four directors and one auditor, and Kubota one director and one auditor.
Who buys the pipe
The new company's only customers will be its two owners. Nippon Chutetsukan will receive finished straight pipe. Kubota will receive finished and semi-finished small-diameter pipe, 75mm to 250mm in nominal diameter.
Nippon Chutetsukan expects that consolidating both companies' equipment will raise factory productivity and profitability. The disclosure calls this an expectation, and it gives no earnings outlook for the new company. Nippon Chutetsukan says the effect on its results is already included in the full-year forecast for the year to March 2027 that it published on July 31, 2026.
The approval still needed
The record date for the extraordinary shareholders' meeting is October 20, and the vote is scheduled for December 17. The new company's capital is planned to rise from ¥30mn to ¥300mn in December, before the split. The company says the dates may change. The assets, liabilities and book values to be transferred have not been fixed; the company says it will announce them once the parties decide.