Fuji is contributing its ED&C operations in Japan and other Asian countries, including China, while Schneider plans to contribute most of its Schneider Electric Japan operation, as well as a circuit-breaker production line in Thailand. The French-based multinational is also investing around €60m in cash that will give it a share of about 40% in the JV, with the majority 60% stake being held by Fuji.

The new Tokyo-based business, yet to be named, will have a global workforce of around 3,000 people and is predicted to generate annual revenues of more than €450m. The aim is to combine Schneider’s and Fuji`s strengths to increase their penetration in the Japanese market, and to become the preferred supplier to Japanese multinational customers worldwide.

The partners plan to supply each other’s complementary products and to share each other’s global networks. They hope that the JV will become an industry-leading company in terms of quality, cost and product line-up.

The partners say that the combination will benefit from Schneider Electric`s global strength in electrical distribution products, and from Fuji`s strong brand awareness and distribution network in Japan. They "believe that this new company will position us to be an unsurpassed global leader in the key product areas in Asia".

The new joint venture builds on an earlier JV between Schneider and Fuji, which has been manufacturing circuit breakers in China since 2004. The partners hope to finalise negotiations and to obtain the necessary regulatory approvals for the new business by July 2008.

The proposed JV will not affect Schneider’s existing operations in Japan, such as its variable speed drives joint venture with Toshiba.