Using a large sample of subsidiaries listed in Japan between 1980 and 2005, we find that the experience of NEC Electronics is not unique.
FORBES: Do Inefficient Stock Markets Drive Bad Corporate Governance?
"We wanted a unique architecture we could sell into the console, arcade and PC markets and accumulate a huge number of software titles, " says Hirokazu Hashimoto, president of NEC Electronics in Santa Clara, California, who's in charge of the PowerVR.
But minority shareholders in NEC Electronics did not seem to have anticipated this kind of activity, and they earned post-listing returns that were well below those of the aggregate stock market, and well below the returns earned by shareholders of the parent company.
FORBES: Do Inefficient Stock Markets Drive Bad Corporate Governance?
Japanese handsets are among the most sophisticated in the world, and it's a market dominated by some of the toughest companies in electronics: Sharp, Panasonic, NEC, and Sony's joint venture with Ericsson, Sony Ericsson.
Japanese handsets are among the most sophisticated in the world, and it's a market dominated by some of the toughest companies in electronics: Sharp, Panasonic, NEC (nasdaq: NIPNY - news - people ), and Sony's joint venture with Ericsson (nasdaq: ERIC - news - people ), Sony Ericsson.
Clear gainers include Intel, which produces 85% of all microprocessors, and the makers of dynamic random access memory (DRAM) chips such as Japan's NEC and Toshiba and South Korea's Samsung Electronics, LG Semicon and Hyundai Electronics.
Other Japanese consumer electronics makers are already making computers, including Toshiba, NEC and Sharp.
To understand how Japan's once-mighty electronics industry has grown so flabby, consider the story of NEC.
Companies such as Matsushita, Sanyo, NEC and Toshiba have also displayed 3-D televisions and mobiles at consumer electronics shows.
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