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Sumitomo Metals to Acquire Standard Steel
06/28/2011 - Sumitomo Metal Industries, Ltd. and Sumitomo Corp. have agreed to acquire Steel Wheel Acquisition Corp., the parent company of Standard Steel, Inc. in the United States, for approximately US$340 million.
Sumitomo Metal Industries, Ltd. and Sumitomo Corp. have agreed to acquire Steel Wheel Acquisition Corp. (SWAC), the parent company of Standard Steel, Inc. in the United States, for approximately US$340 million. The shareholder structure after acquisition will be Sumitomo Metals 90%, Sumitomo Corp. 10%.
The acquisition of SWAC, anticipated to be completed before yearend, is part of Sumitomo Metals’ strategy to expand into overseas growth markets with overseas production bases while it also continues to strengthen its core domestic manufacturing bases. After this acquisition, the company plans to raise its presence in North America and then expand into Europe, Asia, and other areas.
Following the completion of the acquisition, Sumitomo Metals plans to transfer certain technology, such as its proprietary SIRD (Sumitomo Inclined Rotary Dishing) pressing facility, a rotary forging press for wheels, and its ultra-clean steel technology, to Standard Steel. The aim is to enhance its global competitiveness in the manufacture and sale of railway wheels, including wheels used for locomotives and passenger trains, including high-speed rail.
Standard Steel, based in Pittsburgh, Pa., is one of North America’s leading manufacturers of railway wheels and axles with a history of over 200 years. Standard Steel produces steel railroad wheels and axles from its manufacturing facility in Burnham, Pa., and has approximately 620 employees.
Sumitomo Metals is one of the world’s top manufacturers of railway wheels and axles, with a strong focus on the Japanese market. The company’s high-speed railway wheels have been supplied to Japan’s Shinkansen bullet train as well as the Intercity-Express (ICE) trains in Germany.
