Transition to a Holding Company Structure, and Establishment of Domestic Operating Company
May 12, 2023
NTT DATA Corporation
NTT DATA Corporation (the "Company"), in line with its aim to further grow its domestic business, resolved at today's Board of Directors meeting to execute an absorption-type company split agreement (the "Absorption-Type Company Split Agreement") with respect to NTT DATA's domestic business with NTT DATA Japan Preparation Corporation ("Preparation Corporation") and has executed such agreement. Preparation Corporation will succeed to the Company's domestic business pursuant to the Absorption-Type Company Split Agreement and commence its business as a domestic operating company from July 1st. Furthermore, as of the same date, the Company will become a holding company, and shift to a holding company structure with the following subsidiaries under its umbrella, i.e., the new domestic operating company and NTT DATA, Inc., which was established in October last year and oversees the overseas business.
The transition to such structure is subject to approval at the Company's 35th Ordinary General Meeting of Shareholders, which is planned to be held in June 2023.
1. Background
Considering the changes in the business environment with a global perspective, in order to contribute to the growth of our customers' businesses and to become a truly Trusted Global Innovator that supports social infrastructure for the long term, during the period until now, the Company has announced the overseas business integration with NTT Ltd. and the transition to a holding company structure (Note 1), and NTT DATA, Inc., as an overseas operating company, has commenced its business from October 1, 2022. Furthermore, as preparations for the transition to a holding company structure, the Company established Preparation Corporation on November 1st, and on February 22, 2023, decided that, from July 1st onwards, the tradename of the holding company is to be "NTT DATA GROUP CORPORATION" and that of the domestic operating company to be "NTT DATA JAPAN CORPORATION" (Note 2).
In light of such background, a resolution regarding the execution of the Absorption-Type Company Split Agreement was passed at today's Board of Directors meeting. Subject to approval at the Ordinary General Meeting of Shareholders which is planned to be held in June, from July 1, 2023, the Company group will shift to a holding company structure, and on the same date, the domestic operating company will be established under the umbrella of such group.
2. Transition to Holding Company Structure
During the period until now, the domestic business of the Company has been continuously expanding, and its overseas business is also rapidly expanding through the overseas business integration. In light of such circumstances, the Company believes that it is imperative to respond quickly to the changes in the business environment by: shifting to a global management system towards further business expansion in the future; and restructuring the systems for innovation, marketing, corporate governance, and delivery under a global based strategy and in light of domestic and overseas needs, commercial practices and laws and regulations.
In response to such circumstances, the current NTT DATA, as the holding company of the Company group, will, from the perspective of the optimization of the entire group, focus on formulating and executing group business strategies, business management, and securing corporate governance, etc., and strive to improve the corporate value of the entire group. Furthermore, functions such as research and development of technologies which are the source of competitiveness, strategic investments, and support for the deployment of offerings which may be utilized both in Japan and overseas, will be consolidated, and the Company will take the lead in displaying comprehensive capabilities as "One NTT DATA", meaning as NTT DATA group as a whole.
3. Establishment of Domestic Operating Company
The Company group's domestic business has been steadily expanding, reaching a business scale of over 1.6 trillion Japanese Yen as of the fiscal year ending on March 31, 2023. In order to continue meeting the expanding and diversifying needs of the domestic market, the Company's domestic business will be succeeded to and continued by Preparation Corporation and further enhancement of capability and improvement of services will be pursued. In addition, the relationship of trust that we have established with our customers over many years will be further deepened under the corporate philosophy that we have had since the founding of the Company and common across the globe, which is "to use information technology to create new "paradigms" and "value", that help contribute to a more affluent and harmonious society".
＜Image of the transition＞
4. Organizational Restructuring Under the New Structure
After the transition to the new structure, the structure of each company will be as set forth below, following some organizational restructuring.
4-1. NTT DATA GROUP CORPORATION (holding company)
NTT DATA GROUP CORPPORATION will establish corporate staff organizational structures necessary as a holding company and as a listed company, as well as organizational structures for enhancing and promoting innovation, marketing and corporate governance common across the globe, and organizational structures for research and development of technology which are the source of competitiveness, and will promote initiatives for global horizontal collaboration and enhanced strength, including strategic investments.
Corporate Staff Organizational Structures
- Corporate Headquarters
Corporate Headquarters will, in addition to centrally managing all organizational structures with corporate functions and formulating and monitoring business strategies of the entire group, promote sustainable management, strategic human resources strategies across the globe, strategic procurement, and optimization of global IT, etc. - Global Marketing and Communications Headquarters (renamed)
After being renamed from Global Marketing Headquarters, Global Marketing and Communications Headquarters will strengthen the corporate communication functions which enable external and internal communications regarding NTT DATA group's corporate activities, and further strengthen the partnerships with stakeholders such as customers and business partners. - Global Governance Headquarters
Global Governance Headquarters will consolidate functions such as legal, intellectual property, risk management and disaster management, and formulate policies with respect to corporate governance and compliance, which supports the business of the entire Company's group. Furthermore, enhancement of global corporate governance will be promoted through appropriate monitoring and management of group companies. - Global Innovation Headquarters
Global Innovation Headquarters will be responsible for enhancing competitiveness in cross-cutting technology areas such as cloud computing and cyber security, as well as promoting global horizontal collaboration and strengthening alliances with global vendors, and will promote strategic investments across the globe to create new business in the future. - Consulting & Asset Business Transformation Headquarters
Consulting & Asset Business Transformation Headquarters will establish and take the lead at a company-wide level in enhancing consulting business, transforming business operations for the evolution of asset-based business, and building the framework for human resources development. Furthermore, an internal organizational structure with the same name will be established at the domestic operating company to collaborate with each business segment and support the deployment of technology consulting and asset-based offerings which can be utilized across industries.
Cost Center
- Technology and Innovation General Headquarters
Technology and Innovation General Headquarters will, for the global business, conduct research and development on, and provide infrastructure and technology support for advanced technologies such as cloud computing, software manufacturing technologies, cyber security, data and intelligence, and maximize the productivity and competitiveness of the entire group.
4-2. NTT DATA JAPAN CORPORATION (domestic operating company)
NTT DATA JAPAN CORPORATION will, as the domestic operating company, establish the following organizational structures and succeed to and continue the Company's business, and aim for further improvement and growth of services.
Corporate Staff Organizational Structures
- Corporate Strategy Headquarters (newly established)
Corporate Strategy Headquarters will undertake the planning and promotion of the execution of integrated and cross-segment strategies as suitable for a domestic operating company, and will also be responsible for human resources, finance, and marketing and public relations functions, etc. - Corporate Services Headquarters (newly established)
Corporate Services Headquarters will utilize digital technology to implement the improvement and efficiency of corporate functions which support the domestic business, and will also promote strategic procurement to enhance the competitiveness of the domestic business. - Social Design Office
Social Design Office will combine the knowledge that has been accumulated by the Company, and in order to contribute to sustainable growth and development of society, collaborate with customers and other companies that have anticipated the demands of society with new ideas, and create new "paradigms" and "value" from the perspective of consumers.
Public & Social Infrastructure Segment
All organizational structures within this segment will be transferred to the domestic operating company which will take over and continue the current business.
Financial Segment
All organizational structures within this segment will be transferred to the domestic operating company which will take over and continue the current business.
Enterprise Segment
All organizational structures within this segment will be transferred to the domestic operating company which will take over and continue the current business. In addition, the following organizational restructuring will take place.
＜Organizational restructuring within the Enterprise Segment＞
In the enterprise segment, the aim of the current mid-term management plan has been set as "a partner in the structural transformation of customers' businesses and industries using advanced technology" and we are carrying out end-to-end operations from the conception of the industry's digital agenda to presentation and execution of the road map to transformation, and to the creation of results, and are operating business in pursuit of maximizing the value provided to customers.
On this occasion, the current "Industry Business Sector" which exists as an organizational structure that "foresees the future of the industries, envisions with customers how the business should be, and provides value to customers on an end-to-end basis" will be reorganized into units that can accumulate and demonstrate more of its knowledge and expertise on an industry axis, and the following will be newly established.
- First Industry Business Sector (newly established)
Each of the business units regarding "automotive", "machinery, electronics and construction", "transportation, tourism and entertainment" and "media and information services" will be placed under the First Industry Business Sector. - Second Industry Business Sector (newly established)
Each of the business units regarding "distribution and retail", "food, beverage and CPG" and "pharmacy and chemistry" will be placed under the Second Industry Business Sector.
Technology Consulting and Solution Segment
All organizational structures within this segment will be transferred to the domestic operating company which will take over and continue the current business. In addition, the following organizational restructuring will take place.
＜Organizational restructuring within the Technology Consulting and Solution Segment＞
In the Technology Consulting and Solution Segment, upon creating value for customers' businesses, the "design approach" is becoming an indispensable element for supportive action to lead users to achieve their desired state of success and CX advancement.
On this occasion, the "Technology Consulting Sector" will be renamed to "Design & Technology Consulting Sector", and business operations will be further pursued with a view to maximizing the value provided to customers.
At the same time, we will promote the recruitment and training of human resources capable of design and technology consulting, and enhance our ability to provide accompanying-type consulting services with service design and advanced technology (Data & Intelligence, SOE) as starting points.
5. Absorption-Type Company Split
Pursuant to the Absorption-Type Company Split Agreement, all rights and obligations, such as assets, liabilities, agreements, and licenses and certifications required to take over the domestic business will be succeeded to by the domestic operating company. As a result, the outline of NTT DATA GROUP CORPORATION being the holding company and NTT DATA JAPAN CORPORATION being the domestic operating company will be as follows.
The effectuation of the Absorption-Type Company Split Agreement is subject to approval at the Company's 35th Ordinary General Meeting of Shareholders, which is planned to be held in June 2023.
NTT DATA GROUP CORPORATION
| (1) | Name | NTT DATA GROUP CORPORATION (The trade name will be changed from "NTT DATA Corporation" as of July 1, 2023.) |
|---|---|---|
| (2) | Address | 3-3, Toyosu 3-chome, Koto-ku, Tokyo |
| (3) | Title and Name of Representative | Yo Honma, Representative Director, President and Chief Executive Officer (scheduled) (After the election of directors at the general meeting of shareholders of NTT DATA to be held in June 2023, the Representative Director, President and Chief Executive Officer will be officially determined at a meeting of the Board of Directors to be held after such general meeting of shareholders.) |
| (4) | Business Details | Strategy formulation and promotion (including marketing, innovation and strategic investments), business management, technology development and ensuring governance, etc. for the entire NTT DATA group. |
| (5) | Stated Capital Amount | 142,520 million yen (as of March 31, 2023) |
| (6) | Accounting Period | March 31 |
NTT DATA JAPAN CORPORATION
| (1) | Name | NTT DATA JAPAN CORPORATION (The trade name will be changed from "NTT DATA Japan Preparation Corporation" as of July 1, 2023.) |
|---|---|---|
| (2) | Address | 3-3, Toyosu 3-chome, Koto-ku, Tokyo |
| (3) | Title and Name of Representative | Yutaka Sasaki, Representative Director, President and Chief Executive Officer (scheduled) (After the election of directors at the general meeting of shareholders of the domestic business split preparation company to be held in June 2023, the Representative Director, President and Chief Executive Officer will be officially determined at a meeting of the Board of Directors to be held after such general meeting of shareholders.) |
| (4) | Business Details | Consulting, integrated IT solutions, system and software development, maintenance and support, etc. |
| (5) | Stated Capital Amount | 500 million yen (scheduled) |
| (6) | Accounting Period | March 31 |
Please click on the links below for further details.
Timely Disclosure Documents
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(Note 1)
"NTT DATA and NTT will combine their IT Services organizations outside Japan into a new operating company" announced on May 9, 2022.
https://www.nttdata.com/global/en/news/press-release/2022/may/ntt-data-and-ntt-will-combine-their-it-services-organizations-outside-japan--into-a-new-operating -
(Note 2)
"NTT DATA Decides on "NTT DATA, Inc." as Name of New Overseas Operating Company" announced on February 22, 2023.
https://www.nttdata.com/global/en/news/press-release/2022/august/ntt-data-decides-on-ntt-data-inc-as-name-of-new-overseas-operating-company
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