After accumulating some $9 billion in losses, Mitsubishi Motors is bringing its financial house in order. According to Reuters, “Mitsubishi Motors is considering asking shareholders to approve plans for a 10-for-1 reverse stock split. At the same time, the company may ask shareholders to approve a capital reorganization – a change in accounting that would make it possible to resume paying dividends.”
Reuters’ sources say the first steps could be announced as soon as Friday and put it before shareholders at the annual meeting at the end of June, “to close a chapter that began with a 2004 bailout for Mitsubishi Motors.”
Being part of the Mitsubishi group, one of the largest in Japan, Mitsubishi Motors has rich parents that were able to finance an often rocky career of its offspring. Mitsu had a partnership with Chrysler, which was dissolved in the 90s. A decade later, Mitsubishi and Chrysler were back together, as part of a tumultuous threesome with Daimler. In 2004, Mitsubishi dropped out after a boardroom drama at DaimlerChrysler prevented a financial salvage operation of the money-leaking company. At this point, Mitsubishi Motors basically moved in with its well-to-do parent.
Mitsubishi gave up production in Europe by the end of 2012, and is focusing on the developing markets, mostly Southeast Asia, where it is strong. Mitsubishi has three assembly plants in Thailand alone. At home in Japan, it is streamlining its production. At the Mizushima plant on Monday, I saw nearly to complete catalog of Mitsubishi cars come down the same assembly line. Mitsubishi had two lines, one for Kei cars, one for regular cars. Even those were combined into one – rather long – multi-model line.
Mitsubishi’s best-selling models on a global basis are the Triton pickup truck and the small SUV sold as both the RVR and Outlander Sport.
“A decade later, Mitsubishi and Chrysler were back together, as part of a tumultuous threesome with Daimler.”
Four-way. Hyundai was in the mix as well.
I believe one of the things to come out of that unholy second marriage was the Dodge Caliber, which we had one of, a white 2007 SXT.
I thought Mitsubishi’s been spending the better part of 2 decades getting tooled?
So, is the financial restructuring going to help them develop new products?
Reverse splits indicate fear a stock’s price will continue to swoon, then delisting, then the disgrace and curse of being on a less prestigious exchange. Had to laugh at the prospect of a dividend. How about a buyback while they’re at it?
Sounds ominous. I knew they were dying in the US (next to leave, I say), but didn’t know they were that bad off worldwide.
With Suzuki gone from here, Mitsubishi should cut a deal with them and rebadge the Kazashi as the new Galant.
That’s exactly what I was thinking!
I hope this re-organization serves them well. This kind of stock spiltting must be a common thing in Japan, since Mazda did the same thing last year to get out of their mire of 5 years of losses. Hopefully, Mitsubishi Industries will inject more capital to help with product development.
Hope they do well. Just bought my second Ralliart here in the states. Great car for me, fun, fast, handles great. In P.I. I have an Adventure, might trade it for an ASX or Montero next year..But I have also taken notice of the Isuzu Alterra.