Japanese 2 Special Steel Wire Makers Integrate 3 Subsidiaries

Japanese major special steel wire makers, Nichia Steel Works and Sumitomo Electric Industries announced on Tuesday they agreed on business integration of 3 subsidiaries, Kokoku Kosensaku of Nichia Steel, Kanto Kosen and Metax of Sumitomo Electric. The 3 subsidiaries will be integrated in April 2007. Nichia Steel Works will hold over 50% investment share to the integrated company. The sales of the new company are estimated to be 16 billion yen per year and the production to be 66,000 tonnes per year with 2 production bases in Kaiduka area near Osaka and Utsunomiya area near Tokyo and about 440 employees.The 3 subsidiaries perform steel wire business including zinc coated steel wire. They are concerned that the domestic market shrinks when the users have shifted their production and purchase to overseas and that Japanese steel wire import has increased. Then Nichia Steel Works and Sumitomo Electric started talking over the integration of the 3 subsidiaries for operational presences in the future. Both firms examine concrete plans for aggregation of production bases and items, intensification of sales power and synergies by the integration.Nichia Steel and Sumitomo electric aim to gain world-leading competition power taking advantage of each subsidiary’s technology and development capability. Then they build up the organization for the improvement of customer satisfaction in wide-ranging business fields.