Mitsui Mining & Smelting Withdraws from TAB/COF Business

Mitsui Mining & Smelting announced on Friday the firm withdraws from TAB/COF business. TAB (tape automated bonding) and COF (chip on film) are film based materials to mount an IC chip connecting with liquid crystal panels or plasma display panels. The business profitability has seriously worsened under tough price competition with TAB/COF suppliers in South Korea and Taiwan. Moreover, television market has shrunk since autumn 2011 and yen exchange rate has currently stayed historically high. Mitsui Mining & Smelting judged the profitability would not improve under the circumstances.

The firm will terminate production of COF for liquid crystal panels and TAB for plasma display panels at the wholly-owned subsidiary in Yamaguchi, Japan, named MCS, in June 2012. As for TAB used for other applications such as printers, the production will be ceased at the end of March 2013. Mitsui Mining & Smelting tries to secure the employment of the employees by transfer inside Mitsui Mining & Smelting Group.

Mitsui Mining & Smelting has been the global top supplier of COF but the profitability has sharply worsened by severe price competition. In April 2011, the firm closed MCS’s Omuta plant in Fukuoka, Japan and integrated TAB/COF production into MCS’s Shimonoseki plant in Yamaguchi, Japan.

Mitsui Mining & Smelting also announced on Friday the firm abandons formulation of its new mid-term management plan scheduled to start in April 2012. The firm explained the business circumstances have drastically changed due to extremely strong yen trend, European financial crisis and a concern on global economy downturn since the firm has started the plan designing. The firm will formulate a single year business plan for fiscal 2012 ending in March 2013.