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Nov. 29 (Bloomberg) -- Pasco Corp., Japan’s largest provider of digital maps, plans to buy companies overseas because of the near-record high yen and surging demand in emerging markets caused by construction booms.
“We welcome the strong yen,” President Youichi Sugimoto said in a Nov. 25 interview at Pasco’s Tokyo headquarters. “As far as we can find attractive companies, we aggressively intend to buy them.”
Pasco, which generates and analyzes maps created from satellites and planes, particularly intends to expand in South America and enter Africa and central Asia because of rising urbanization, Sugimoto said. The company has also had a surge in domestic interest since Japan’s March earthquake as companies seek quicker and more-detail information about their operations.
Since the quake, Pasco has signed contracts or begun talks with around 200 Japanese carmakers, retailers, financial institutions and other companies about an application that lets users track employees and operations, Sugimoto said. Prior to the temblor, it only had one or two clients.
“Corporate customers’ way of thinking about disasters has totally changed,” Sugimoto said. “Sales from this business are sure to increase in future.”
The domestic demand and overseas acquisitions may help Pasco boost annual sales to at least 58 billion yen ($747 million) in about four years, Sugimoto said. That’s 26 percent higher than its 46 billion yen target for the current financial year. Pasco generated about 90 percent of sales in Japan last fiscal year.
The company, founded as an aerial-surveyor in 1953, rose 2.6 percent to 238 yen in Tokyo trading. The stock has gained 3 percent this year compared with the Topix Index’s 19 percent decline. Secom Co., the Tokyo-based maker of security equipment, owns 70 percent of the imaging company.
To expand overseas, Pasco is looking to buy European and U.S. companies with branches in Africa and South America, Sugimoto said without elaboration. Last month, it bought a 70 percent stake in Keystone Aerial Surveys Inc., a U.S. geospatial company which provides mapping data for Microsoft Corp.’s Bing search engine. Keystone’s 18 aerial survey aircraft bolstered Pasco’s fleet of 42.
The yen traded at 77.81 to the dollar, having gained 4.7 percent this year. It reached a postwar high of 75.35 on Oct. 31.
For Related New and Information: Pasco’s sales breakdown: 9232 JP <Equity> FA PROD <GO> M&A lookup: MA <GO> World Currency Ranker: WCRS <GO>
--Editors: Neil Denslow, Vipin V. Nair
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