Establishment of a Joint Venture Company for Secondary Processing of Specialty Steel Long Products in India

Mukand Limited (Head Office: Maharashtra State, India; Representatives: Niraj Ramkrishna Bajaj and Rajesh Viren Shah, hereinafter Mukand) and Sumitomo Corporation (Head Office: Chuo-ku, Tokyo; President and CEO: Kuniharu Nakamura) have agreed to establish a joint venture company (Head Office: Maharashtra State, India, hereinafter new company) for the secondary processing of specialty steel long products in India.

Against a background of rapid economic growth, the consumer base for two-wheeled and four-wheeled vehicles has been rapidly expanding in India.

The two-wheeled vehicle market in India is now the second largest in the world. The market for four-wheeled vehicles, mainly small cars, doubled over the last five years to quickly become the sixth largest in the world.

Automotive manufacturers worldwide are expanding their range of products by bringing strategically designed cars to the expanding Indian market. To keep up with increasing demand for specialty steel products for automobile parts, Mukand and Sumitomo Corporation will establish the new company for manufacture and sale of secondary processed specialty steel and stainless steel long products in October 2012.

The new company will take over Mukand's business for secondary processing of specialty steel long products for consideration of approximately INR 2525mil, and continue to operate Mukand's current plant for a while after the new company's establishment.

Production capacity is 6000mt per month. The new company plans to immediately begin building a new plant in Lonand, Satara District, Maharashtra State to expand production capacity in response to increasing demand.

The new company will perform secondary processing of specialty steel and stainless steel long products from hot rolled long products provided by Mukand and provide materials mainly to automotive parts manufacturers. Bringing together Mukand's manufacturing and engineering capabilities and Sumitomo Corporation's sales expertise and management know-how, the new company will aim to be a leading company in the Indian specialty steel market.

Mukand is a historic specialty steel manufacturer of long products in India. Mukand has high engineering and development capability based on accumulated know-how, and is a leader in the specialty steel long products industry in India. Mukand products are also broadly accepted by Japanese, European and U.S users in the Indian market and are exported to Europe, Middle East, China and so on.

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