LiEich Inc. divested its educational subsidiary, Yoshino Souiku Co., to Manabiba for 1 yen to exit from an underperforming sector amid demographic challenges in the Japanese education market.

Target Information

LiEich Inc. (ticker: 5856), a company primarily engaged in the wholesale of meat and liquor manufacturing, has decided to divest its subsidiary, Yoshino Souiku Co., which operates in the learning and educational book publishing sector. This divestiture, accompanied by a history of poor performance within the educational segment, marks LiEich's strategic exit from a declining industry. The subsidiary, based in Chuo, Tokyo, has been functioning at a loss, with a reported sales figure of zero and operational losses amounting to 384,000 yen in the fiscal year ending March 2025.

Historically, the educational business has been part of LiEich since 2006. However, the firm has struggled to maintain profitability due to a shrinking user base attributed to Japan's declining birth rate and intensified competition within the sector. With such challenges, it became imperative for LiEich to reassess its business strategy and refocus its resources on more profitable ventures.

Industry Overview in Japan

The education and publishing industry in Japan has been facing significant challenges over the past decade. A combination of demographic shifts, such as a declining birth rate, has led to a reduction in pote