Japan’s Sumitomo Corp has become the majority owner of US rental company Sunstate Equipment. Sumitomo acquired a minority stake in Sunstate in December 2009 but has now increased its investment to become the major owner.
Sunstate chairman, founder and previous majority stakeholder, Mike Watts, retains a 20% share of the business and he and Sunstate’s existing management team will continue to run the business and remain in their current roles.
In a joint statement, Mr Watts and Sumitomo said; “Following a strong performance by Sunstate Equipment in 2012, both partners believe the equipment rental industry is poised for solid growth in 2013 and beyond.
“This increased investment enhances Sunstate Equipment’s financial strength and ability to execute its long term business strategies.”
Mr Watts said the two companies had an excellent working relationship, sharing similar values and cultures. He added; “This is a very positive thing for Sunstate’s employees, our management, and the opportunities that will be created by this change.”
Sumitomo invested US$50 million in Sunstate in December 2009. Since then the business has grown, reaching total revenues of $178 million in 2011. It has 54 branches and is headquartered in Phoenix, Arizona. The company was founded by Mr Watts in 1977.
Sumitomo has other rental businesses around the world. In Japan it owns a minority share of Taiyo Kenki and in Canada it owns SMS Rents. Sumitomo also runs Komatsu construction equipment distributorships in Canada, US and Europe.