MHI to Sell Equity Stake in Shonan Monorail to Michinori Holdings, A Transport Business Support Company

Shonan Monorail Co., Ltd. was established in 1966 with the aim of improving transportation convenience in Shonan, the coastal region along Sagami Bay in Kanagawa Prefecture, in tandem with this area's residential development. Its founding members include Mitsubishi Electric Corporation, Mitsubishi Corporation and MHI, which delivered the railway carriages for what was Japan's first suspended (SAFEGE type) monorail. The monorail operates over a total distance of 6.6 kilometers, from Ofuna Station to Shonan-Enoshima Station. It plays a significant role as a public transport system serving the local area, with some 10 million passengers using the line every year.

Shonan Monorail Co., Ltd. has long contributed to MHI's development as a leading integrator of railway and urban transport systems in various ways: for example, technical verification and exploration of user needs. In recent years, however, as MHI has increasingly faced the challenges of responding to intensifying global competition, the company has opted to accelerate investing its management resources into areas of core competence with strong growth potential. The decision to release its equity in Shonan Monorail at this time falls in line with its present policy to concentrate on enhancing its competitive strength in the global market.

Michinori Holdings supports the vitalization of area transportation businesses operating in the northern Kanto and Tohoku regions, its corporate aim being to contribute to regional economies. The company has five fully owned subsidiaries: the Fukushima Transportation group, Northern Iwate Transportation group, Kanto Transportation group, Ibaraki Kotsu group and the Aizu Bus group. Along with the acquisition of MHI's equity stake in Shonan Monorail, Michinori Holdings will simultaneously take over the corresponding stakes, 18.4% each, of Mitsubishi Electric Corporation and Mitsubishi Corporation with the intent of adding Shonan Monorail's transportation system in the Tokyo metropolitan area to their group portfolio. In doing so, Michinori Holdings is looking to enhance their added value from the further expansion of their wide-area links in area transport systems.

Even after the transfer of its shareholdings, MHI will continue to cooperate with Shonan Monorail through the provision of railway cars, maintenance services, etc.