JTB Hawaii’s acquisition of MC&A Inc. will create a destination management giant that will bring about 1 million domestic and international visitors to the isles annually, supplying roughly an eighth of Hawaii’s annual visitor arrivals.

JTB Hawaii, the first Japanese travel company to establish a presence in the isles, aims to expand its global reach with the acquisition of MC&A, the state’s largest destination and event management company.

“This deal opens the world to JTB,” said Tsukasa Harufuku, JTB Hawaii president and CEO.

Harufuku declined to disclose financial terms of the deal, which is set to close Jan. 1. However, he revealed that MC&A will keep its name and remain a stand-alone operation under JTB Hawaii, which opened its first Honolulu offices in 1964. MC&A President and CEO Chris Resich will continue to lead the organization. Clients of both companies are expected to keep their service teams.

The 680 employees who work under JTB Hawaii’s umbrella of businesses will keep their jobs, Harufuku said. JTB Hawaii’s operations include JTB Hawaii Travel LLC, JTB Global Travel Service LLC, Travel Plaza Transportation LLC, Tachibana Enterprises LLC and Travel Plaza LLC. Likewise, the 240 employees who work for MC&A will be retained in the deal, he said.

Harufuku said the purchase allows JTB Hawaii to shore up the company’s footprint in the isles. In recent years JTB Hawaii’s growth has been threatened by Japan’s aging population, the country’s economic struggles and its status as a mature destination.

“We’ve been working as a business in Hawaii for more than 50 years,” Harufuku said. “Previously, our customers were coming from Japan only. Then we started expanding into other Asian countries like Korea and China.”

Harufuku said JTB began eyeing English-speaking markets like the U.S. mainland, Canada and Oceania about seven or eight years ago but struggled to gain entry. Since these markets make up the lion’s share of visitors to Hawaii, Harufuku said it is natural that they are included in JTB Hawaii’s diversification plan.

“There are 8 million visitors coming to Hawaii, and about 5 million of them are coming from the U.S. mainland, which has the largest share. Japan’s market is declining,” he said.

In 1997, the peak year for Japanese visitors to Hawaii, the state welcomed 2.2 million tourists from Japan. By 2015 that number had dropped to just under 1.5 million. Harufuku said further declines are anticipated as Japan’s population is projected to shrink 20 percent in the next 20 years.

Harufuku said last year JTB Hawaii brought 412,000 visitors from Japan to Hawaii. Approximately 80,000 of them represented the group business market, he said. But JTB Hawaii’s share of the islands’ overall tourism market will expand greatly when it joins forces with MC&A, he said.

MC&A, which was founded in 1983, has roughly 50 percent of Hawaii’s total U.S. and Canada inbound market for meetings, incentives, conventions and events (MICE), Harufuku said. The company books more than 80 percent of the state’s cruise business and is bringing 170,000 visitors from North America and Australia to Hawaii on vacation packages, he said.

Keith Vieira, principal of KV and Associates Hospitality consulting, said the joining of these two companies allows Hawaii to advance further into the group tourism market.

“We’ve always wanted to be the bridge to the Pacific Rim meetings market,” Vieira said. “The synergies of these two companies will bring that closer to reality. JTB has an incredibly strong presence in Japan and throughout Asia. MC&A has similar connections to the English-speaking markets. Together they may be able to leverage more global visitors, especially incentive travelers.”

MC&A, whose businesses include Island Partners Hawaii, Diamond Head Vacations, Luxe Travel Hawaii and Upon a Star Hawaii, also is expected to broaden JTB Hawaii’s reach into the leisure and cruise markets.

“We’ll have more bargaining power, and we’ll be better able to face competition from the online travel agencies like Expedia, American Express and Priceline,” Harufuku said.

Resich said in a statement that the “strategic alliance” will enable both companies to capitalize on mutual strengths and pursue more growth.

“We are thrilled to be joining a strong and trusted organization like JTB Hawaii and are excited to realize our own goal of expanding our widely respected business brands into Asian markets and destinations outside of Hawaii through the JTB group network, which creates significant benefits for our clients,” Resich said.