Futong Group to Get 18.58% Share in SWCC Showa

SWCC Showa Holdings announced on Friday the firm enters into capital alliance with the business partner of Futong Group of China. Futong Group purchases 18.58% of voting right in SWCC Showa Holdings through allocation of new shares to Futong Group at 105 yen per share or total around 6 billion yen. Futong Group will be the largest shareholder of SWCC Showa Holdings instead of Toshiba Corporation, which has been the largest shareholder since establish of SWCC Showa Holdings. Futong Group pays the money from June 17 to September 20. SWCC Showa Holdings invests a half of the generated cash into Chinese business while with the remaining money the firm tries to improve the competitiveness of the domestic business.

They have been business partner for 16 years through Chinese joint ventures to make optical cable, optical parts and electronic wire. Under the new agreement, they expand the alliances. They step forward to improve the cooperation by expanding bare copper wire making joint venture launched in 2010, new joint venture to make industrial electric wire and new research and development center in China.

SWCC Showa Holdings expands annual output capacity at the bare copper wire plant in China for around 1 billion yen by expanding existing capacity from annual 30,000 tonnes to 60,000 tonnes and building new plant with 60,000 tonnes of output capacity in Tianjin or other northeastern Chinese site. The firm plans to build new industrial electric wire plant to supply cable for solar power generation and aluminium electric wire and research and development center to check and analyze of the materials for around 2 billion yen.

They keep 50/50 joint venture scheme. SWCC Showa Holdings and Futong Group invest each 3 billion yen for the expansion projects. SWCC Showa Holdings tries to follow growing demand in infrastructure development in China and Southeast Asia through the further cooperation with Futong Group. Futong Group with mainly optical and metal communication cable making business expands other business area and global business.