Mitsui Mining & Smelting, Sumitomo Metal Mining to Merge Copper Rolling

Mitsui Mining & Smelting and Sumitomo Metal Mining announced on Friday they reached basic agreement to integrate their rolled copper businesses into new company in April 2010. They try to realize 1 billion yen of annual cost saving including better sales force and logistics through the integration when the production level is very slow due to low demand since late 2008.

They integrate rolled copper products unit of Mitsui Mining & Smelting and Sumitomo Metal Mining’s subsidiary, Sumitomo Metal Mining Brass & Copper. They establish 50/50 joint venture with monthly 6,000 tonnes of production capacity at Ageo plant, Saitama and Inabe plant, Mie. Brass strip represents around 65% of the production while the new company makes copper sheet and strip, brass sheet and rolled copper foil.

They expect the integration enables to reduce administration cost through integration of sales offices while they expect another synergy in better logistics, better procurement and headquarter and management system.

Mitsui Mining & Smelting has around 4,000 tonnes per month of rolled copper production capacity with around 340 employees. Sumitomo Metal Mining’s subsidiary has monthly 2,000 tonnes of production capacity with around 130 employees.