Daido Steel to Merge Group Stainless Wire Makers

Daido Steel announced on Friday Osaka based stainless wire makers, Daido Stainless Steel and Nippon Seisen will merge the business on October 1. Daido Steel tries to improve the efficiency through the merger of the group companies. The new company with annual 35 billion yen of sales and 40,000 tonnes of output will have 33% share of domestic stainless wire market. Daido Steel tries to improve the downstream operations for better competitiveness and supply ability of high performance products when the users shift to offshore base, Chinese and South Korean makers expand the operation and nickel price surges. Nippon Seisen acquires Daido Stainless by allocating 11.1 shares of Nippon Seisen per an ordinary share of Daido Stainless. Daido Steel has 40.3% of the new firm with 5 billion yen of capital. Nippon Seisen is domestic top stainless wire maker with 23% of share. The consolidated sales were 23 billion yen for the year to March 2006. Daido Stainless has 10% domestic share and the sales were 9.85 billion yen for the year to March 2006.