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HP, Konica bond for digital copiers

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CIOL Bureau
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TOKYO: Japanese photo film and copier maker Konica Minolta Holdings Inc. said that it had agreed with U.S. computer and printer maker Hewlett-Packard Co. to jointly develop digital multi-function copiers.



The alliance is Konica Minolta's first major strategic step after the company was created earlier in August through a merger of camera and office equipment makers Konica Corp and Minolta Co in a bid to enter the top ranks of office equipment makers.



Under the agreement, Konica Minolta will make the core parts of the advanced machines and supply them to HP, which will sell the products through its sales network under its own brand after adding its own electronic control mechanisms and software.



Multi-function copiers include such features as fax machines and printers.



Shipment to HP will start as early as in October, with sales estimated to total about 10 billion yen ($85.23 million) in the first year.



"This is a positive surprise," said Takaaki Ando, an analyst at Shinko Securities.



"HP's strong brand name and top-notch customer base can help Konica Minolta sharply boost its production."



Japan's Canon Inc., the world's largest office equipment maker, and Ricoh Co Ltd. are boosting their share of the market for office-use multi-function copiers, but HP the world's top maker of office-use laser printers, has been slow to develop such products.



Business daily Nihon Keizai Shimbun said, the alliance with HP, would boost Konica Minolta's revenue by more than 100 billion yen a year, by the business year starting in April 2006.



The company would not comment on that figure.



Shares in Konica Minolta were up 4.93 percent at 1,512 yen by mid-afternoon, outperforming the Nikkei average, which was up 0.72 percent. ($1=117.32 yen)



© Reuters

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