A letter of intent was signed recently in Bangkok between Kyodo chairman Masahiro Yamaguchi and NMG chairman Thanachai Theerapattanavong.

Under the deal, Kyodo and WPS will each hold a 49-per-cent stake in the joint venture, while the remaining 2 per cent will be owned by a paper trading company, San-Mic Trading (Thailand) Co Ltd.

The joint venture will focus on manufacturing commercial prints such as books and magazines for export and the domestic market.

It is planned to be established in January and production will start in February or March at the WPS plant near Suvarnabhumi Airport. Kyodo Printing Co (S'pore) Pte Ltd (KPS), a subsidiary of Kyodo, will provide printing machinery and tools, printing technology and know-how.

The joint venture will provide a commercial printing service in conjunction with KPS, but will not involve any printing work for newspapers. Founded in June 1897, Kyodo is one of the leading printing houses in Japan. The company prints books, catalogues and posters, while its other services include metal printing, packaging, business forms and documents, smart and prepaid cards. It has 10 major printing plants in Japan and one in Singapore.

With an annual turnover of 100 billion yen (Bt31.4 billion), Kyodo is now the third-largest printing house in Japan. The total printing market in Japan is worth about ¥8 trillion, with about 30,000 printing houses throughout the country.

"This is a groundbreaking joint venture and the first of its kind in Thailand. It ushers in a new era for the Thai printing industry in terms of reaching out to world markets," said Thanachai.

"Kyodo has modern printing technology in Japan and its plant in Singapore is also considered one of the best in the country in terms of quality. Its relocation of printing facilities to the WPS plant will help create the best prints ever made in Thailand," he said.

Capital investment of about Bt700 million will be made in the joint venture.

Thanachai said the printing facility would focus on non-newspaper products such as pocket books, brochures, product catalogues, text books and magazines. Most products will be for export. Domestically, the company will supply Japanese clients with business operations in Thailand.

"Our printing house on Bang Na-Trat Road Km 29 generated revenue of between Bt600 million and Bt700 million last year, of which about Bt200 million was from non-newspaper products. However, with the new Kyodo printing facility, we expect revenue from commercial prints or non-newspaper products will exceed Bt1 billion in the next three years," said the NMG chief.

Kyodo chairman Yamaguchi said the new printing facility in Thailand would bring Kyodo a competitive cost advantage.

Kyodo currently ships its products to Australia, the United States and the United Kingdom from its Singapore plant. The Singapore subsidiary has achieved annual sales of ¥1.5 billion.

Yamaguchi said Kyodo would maintain its pre-press facility in Singapore while shifting printing/binding operations to Thailand. The company will also support the development of pre-press operations as part of the joint venture.

"While our Singapore subsidiary is mostly for export, Nation Multimedia Group is quite strong in the domestic market. The partnership will help each company to expand its customer base," said Yamaguchi.

NMG has long-established relations with Japanese companies. The company prints the satellite editions of Yomiuri Shimbun, Japan's largest-circulation daily newspaper. It is also a licence holder for several well-known Japanese cartoons for the teenage market.

Kwanchai Rungfapaisarn

The Nation