June 11, 2010
Furukawa Electric (FEC) has decided to enter into formal negotiations with Anhui Xinke New materials Co., Ltd. (hereinafter, “AX,” refer to Note 1) regarding the establishment of a joint venture company in which AX would hold a 60% stake, with Furukawa Metal Wuxi (hereinafter, “FMW”, refer to Note 2), a wholly owned subsidiary of FEC. By entering into a joint venture, FMW expects to enhance its cost competitiveness by strengthening raw material procurement and the use of local plant operation management knowhow, and boost customer satisfaction to existing Japan-based users. It will also enhance its sales to the volume zone, Chinese local users, with the sales force of AX, a major manufacturer of wrought copper products in China, shares in which are traded in the Shanghai Stock Exchange. Formal negotiations will now proceed, based on the premises of maintaining the quality of products and services equivalent at current levels, securing of employment and employee treatment, and increasing capital after the joint venture is established to pursue further growth.
With business deployment in the electronics parts market such as lead frames and connectors expected to accelerate in China and other BRICs countries, FEC had been studying its overseas strategy. With this project as a foothold, the Company will continue to consider alliances with AX to strengthen not only FMW, but also the strategy for China and other markets of FEC’s copper strip business.
(Note 1)AX(Anhui Xinke New Materials Co., Ltd.)
- Chairman : Zhou Rui Ting
- President : Zhang Xiao Guan
- Head Office : Wuhu City Economic and Technical Development Zone, Wuhu, Anhui, China
- No. of employees : 1,980
- Business : Manufacture, R&D, and sales of copper and copper alloy material-based processed products
(Note 2)FMW (Furukawa Metal Wuxi Co., Ltd.)
- Chairman : Toshio Tozaki (General Manager, Strip Business, Metals Company, FEC)
- President : Toshiki Yamamoto
- Head Office : High-Tech Investment & Development Zone, Wuxi, Jiangsu, China
- No. of employees : 196
- Business : Manufacture and sales of phosphor bronze strip