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KAGA ELECTRONICS CO., LTD. hereby announces that it has entered into a basic agreement with Star seeds Co., Ltd., an AI infrastructure provider offering end-to-end solutions entirely within Japan, from GPU procurement to AI data center construction and operation. The agreement covers the Company’s contract manufacturing of GPU servers, general-purpose servers and other products planned by Star seeds, as outlined below.
Background and Purpose of the Collaboration
As AI technologies, including generative AI, become more widespread and sophisticated, demand for AI computing is expanding worldwide. Investment in high-performance GPU servers and infrastructure for AI data centers remains solid. However, many server products depend on overseas manufacturing, and lengthening procurement lead times and instability in product supply pose challenges. Against this market backdrop, Star seeds has provided highly reliable AI infrastructure built on Japan’s precision manufacturing technologies. It has also worked to secure and fulfill orders for servers—including GPU servers and general-purpose servers—for large-scale data centers. This collaboration on the production of AI servers will further advance Star seeds’ efforts to date, with the aim of resolving these challenges by stablishing a system in Japan for the stable production and supply of AI servers. In its GPU server and AI infrastructure businesses, Star seeds has product planning expertise, procurement channels and the ability to capture demand. Meanwhile, through its longstanding EMS business (contract development and manufacturing services for electronic equipment), the Company has built up manufacturing and quality control systems, a materials procurement network and supply chain management capabilities. By combining these strengths, the two companies will work toward the early launch and stable operation of a domestic production system for AI servers and deliver short lead times, high quality and supply stability in the AI infrastructure market, contributing to the development of Japan’s AI infrastructure.
Key Details of the Collaboration
Star seeds will handle product planning for high-performance GPU servers and general-purpose servers and procure the latest-generation GPU products from NVIDIA and other suppliers. For production, the Company will use factory facilities and resources in Japan belonging to its business partner. Under its quality control framework, the Company will provide contract manufacturing services spanning the full process from procurement and management of materials—including electronic components—through product manufacturing and assembly, pre-shipment inspection and packaging to finished goods management. Star seeds will bear the cost of factory renovations required to carry out these operations. It will also purchase the necessary manufacturing equipment and then lend it to the Company free of charge. In addition, separate agreements to be concluded for individual products will set out the specific terms of mass-production transactions, including prices, quantities and delivery dates.
