JFE, Sahaviriya Steel and Marubeni-Itochu Steel Sign Partnership Agreement
10/31/2012 - JFE and MISI will invest US$25 million each in Sahaviriya Steel Industries (SSI), increasing their stakes in the joint venture company, Thai Cold Rolled Steel Sheet. JFE has agreed to support SSI with a continuous supply of steel as well as help to imiprove operational performance through technical cooperation.
On 31 October 2012, JFE Steel Corporation, Sahaviriya Steel Industries Public Company (SSI) and Marubeni-Itochu Steel (MISI) signed a partnership agreement.
JFE and MISI will invest US$25 million each in subscribing SSI new ordinary shares at the price of 0.68 baht per share under SSI’s Comprehensive Financial Plan.
JFE and MISI will increase its stake in the existing joint venture company, Thai Cold Rolled Steel Sheet Public Company Limited (TCRSS) by buying shares from SSI. After completion of the deal, SSI and JFE will each hold 36.04% of the shares in TCRSS, and MISI 25.10%. Also, JFE will provide technical assistance, assist and transfer to TCRSS the necessary technology for producing stable supplies of cold rolled steel sheets to meet the growing demand of the Thai automotive industry.
In order to strengthen JFE-MISI-SSI business partnership, the three firms agree that JFE shall support SSI Group with continuous steel supply, which provides additional steel material stability for SSI.
In addition, JFE agrees to support SSI Group in the effort to continuously improve operational performance through technical cooperation.
The three firms foresee growing demand in the ASEAN market, especially in high grade steel sheet products for the automobile industry. The cooperation of SSI-JFE-MISI under the Partnership Agreement, will result in better products and services for the customers in the region. In the Thai market in particular, this partnership will lead to more localization of high grade steel sheet and add value to the customers and local industries.
Sahaviriya Steel Industries PLC or SSI is ASEAN’s largest fully-integrated flat steel producer with 4 million ton annual capacity of hot rolled steel sheet in coils (HRC). SSI endeavors to supply premium-grade steel sheets to cater to the region’s growing demand in various sectors such as automobile, energy, transportation and construction sectors. In the upstream side, SSI owns SSI Teesside, a 3.6 million tons per annum fully-integrated iron-steel making plant located in Redcar in the northeast of UK, through a wholly-owned subsidiary Sahaviriya Steel Industry UK Limited (“SSI UK”). SSI Teesside supplies premium-grade steel slabs to SSI to feed its growing demand, as well as to other rolling mills around the world. In the downstream side, SSI has investments in joint-venture downstream plants: namely Thai Cold Rolled Steel Sheet Public Company Limited (“TCRSS”) - Thailand’s first and largest cold roll mill, and Thai Coated Steel Sheet Co Ltd (“TCS”) - Southeast Asia’s first and largest electro-galvanizing line. All SSI’s plants in Thailand are located on a world-class coastal industrial site in Bang Saphan, Prachuap Khirikhan Province, 400km south of Bangkok on the western peninsula of Thailand, where they are efficiently integrated with its privately-owned deep-sea port (Prachuap Port Co Ltd or PPC), which allows import of raw materials and export of finished products in large economy of scale. SSI extends its engineering capabilities into its wholly-owned subsidiary, West Coast Engineering Co Ltd or WCE, which specializes in engineering, maintenance, spare parts production, fabrication, erection and commissioning service. Our people’s passion and energy is captured in the Company’s vision statement - “innovate premium value steel products and services for customers; generate consistent profit and sustainable value for stakeholders.”
Marubeni-Itochu Steel Inc. (MISI) was formed in October 2001 when Itochu Corporation and Marubeni Corporation – two major general trading companies or sogo-shosha – merged their steel divisions. Half (50%) of its shares is owned by Itochu Corporation and another (50%) by Marubeni Corporation.
MISI is steadily expanding its overseas bases in a quest to meet the demands in global steel market, and is devoted to creating a vast range of innovative business models with pioneering a new era in every facet of the steel business as an integrated producer in the steel distribution realm.
