To become a distinct group of engineers who support manufacturing through design development and testing JAPAN TECSEED and DRD to merge in April 2017 —New company “PERSOL RESEARCH & DEVELOPMENT” provides high-value-added technological capabilities—

Temp Holdings Co., Ltd. (headquartered in Shibuya-ku, Tokyo, Japan; President, Chief Executive Officer and Representative Director: Masamichi Mizuta), a provider of comprehensive human resource services, will merge JAPAN TECSEED CO., LTD. (headquartered in Naka-ku, Nagoya-shi, Aichi, Japan; President and Representative Director: Mikio Miyamura) and DRD CO., LTD. (headquartered in Ageo-shi, Saitama, Japan; President and Representative Director: Mikio Miyamura), which both undertake the business area of engineering within PERSOL Group, in April 2017, in order to strengthen the operation of the said business area. The name of the new company after the merger will be "PERSOL RESEARCH & DEVELOPMENT CO., LTD." PERSOL RESEARCH & DEVELOPMENT will establish a solid technical platform through combining the extensive and high-level technological capabilities cultivated in the existing businesses. As a group of engineers contributing to society through manufacturing, PERSOL RESEARCH & DEVELOPMENT also aims to provide high-value-added services, by undertaking complete contract manufacturing services from designing through testing in the field of development design, contract manufacturing in a component unit and the dispatch service of engineers.

■Background: Outsourcing of development increases in automotive industry

 In the Japanese domestic automotive industry, there is a growing awareness towards safety and consideration to environment is required, due to changes in the social environment such as an aging population. Development needs cover a wide range of themes including utilizing technology such as IoT and AI, automatic braking systems and automated driving, developing hybrid and electric vehicles, and utilizing hydrogen fuel cells. In addition, the business needs to operate efficiently to realize high-value-added services, while reducing development costs, which tend to increase in order to meet diversified development needs and fluctuations in demand for products.
 One of the measures to resolve the issue is to outsource the tasks in the product development processes. It is a global trend to deliver diversified products and achieve efficiency, cost reduction and sophistication of products in order to satisfy user needs, through the involvement of more than one outsourcers in the automotive development process up to the upstream stage for the purpose of selecting and concentrating the operation, as well as aggregating technological capabilities and knowledge of outsourcers and a wide range of business entities. Furthermore, in the context of outsourcing, it is vital to engage the outsourcers as business partners, who have such advanced technical platforms that not only provide resources in a component unit but also enable the undertaking of complete outsourcing for the entire manufacturing process. Meanwhile, as existing domestic outsourcers mainly consist of subsidiaries of certain manufacturers and the the dispatch service companies for engineers, providing services is limited to only a part of outsourcing and the the dispatch of engineers for particular products and component units. In addition, the aging of engineers, shortage of human resources and handing down of techniques remain challenges in view of an aging population and movement of labor from mature industries to growing industries.

■Impact of merger: All needs in development operation are covered and a shift to high-value-added business is accelerated

 JAPAN TECSEED has strong capabilities in providing engineer the dispatch services mainly for the automotive industry, on-site and off-site contract designing and CAE analysis, and serves in a wide range of businesses from aviation industry to industrial machinery. On the other hand, DRD has its own testing facilities as a company that evolved from the development division of a commercial vehicles manufacturer, and drives the business forward based on its strength of project management capabilities that enable the consistent development from designing through testing.

 After the merger, strengths of both companies will be organically integrated under the new company name PERSOL RESEARCH & DEVELOPMENT. This will build a solid technical platform and enable the provision of one-stop services including complete contract manufacturing services from designing through testing in the automotive development process, contract manufacturing in a component unit, consulting service and staffing of engineers. Moreover, PERSOL RESEARCH & DEVELOPMENT will address various needs from the support for engineers in the short term to the assistance of large-scale project extending over years, leveraging the advanced technical capabilities as well as accumulated know-how and experience. PERSOL RESEARCH & DEVELOPMENT also aims to resolve the issues in the manufacturing industry through proactive involvement in the actions such as assisting personnel career development through knowledge management or talent management system and handing down of technical capabilities acquired as a former manufacturer to inexperienced employees.

 Going forward, PERSOL RESEARCH & DEVELOPMENT will implement advanced technology in the automotive industry such as model-based development, and accelerate the shift to high-value-added business such as consulting business. PERSOL RESEARCH & DEVELOPMENT will thereby expand the know-how accumulated in the automotive industry to other industries and promote overseas deployment including APAC region, aiming to become a group of engineers specialized in design, development and testing to support manufacturing in a broad range of industries and regions.

■New company's logo

■Outline of new company

■Outline of merged subsidiaries (as of December 1, 2016)

Company name	JAPAN TECSEED CO., LTD.	DRD CO., LTD.
Business	Design and R&D business	Design and testing for vehicles and their components
Location of the head office	20F, Nadya Park Business Center Building, 3-18-1 Sakae, Naka-ku, Nagoya-shi, Aichi, Japan	1-1 Oaza, Ageo-shi, Saitama, Japan
Title and name of representative	Mikio Miyamura, President and Representative Director	Mikio Miyamura, President and Representative Director
Capital	495,000,000 yen	70,000,000 yen
Major shareholder and Shareholding Ratio	Temp Holdings Co., Ltd.	JAPAN TECSEED CO., LTD.
URL	http://www.tecseed.co.jp/index.html	http://www.ndrd.co.jp/index.html

■About "PERSOL"

 PERSOL is a new brand introduced in July 2016. The brand name was derived from the concept of "A person grows through his or her work (PERSON) and resolves issues in a society (SOLUTION)". It contains the core message that together, we aspire to take on challenges for the brilliant future while supporting the growth of individuals and organizations.
 PERSOL Group consists of Tempstaff, which provides the dispatch services, and Intelligence, which provides recruitment services and classified ads, as well as over 90 domestic and overseas companies engaged in a wide range of businesses from IT outsourcing to design development. The Group addresses actions to resolve labor and employment issues in a comprehensive manner, aiming to realize the Group's vision, "Create social infrastructure for people and organization that catalyze growth and innovation."