July 21, 2010
Furukawa Electric Industrial Cable Co., Ltd. (head office: Arakawa-ku, Tokyo; President: Kiyoshi Nakayama; a 100% subsidiary of Furukawa Electric Co., Ltd.; hereinafter the “Company”) and Shenyang Furukawa Cable Co., Ltd. (head office: Shenyang, Liaoning Province, China; President: Kazuaki Matsumoto; a 100% subsidiary of Furukawa Electric Co., Ltd.; hereinafter “SFC”) have agreed with Hebei Huatong Wires & Cables Group Co., Ltd. (head office: Tangshan, Hebei Province, China; President: hereinafter “HT”) to establish a joint venture to manufacture and sell industrial rubber cables. The joint venture agreement was signed on July 16.
Objectives of the joint venture
Industrial rubber cables are cables with improved environmental durability and bending resistance, attained by covering the conductive body with rubber. The cables are used mainly in the movable portions of industrial machinery. The Furukawa Electric Group has developed a wide range of applications for these cables, which are used with high and low voltages. The products are used in the high-speed trains of Japan and China, and they have earned an excellent technical evaluation.
In China, demand for electricity has continued to expand in step with economic growth in recent years, and needs have grown for rubber cables used with excavating machinery for coal mine resources and oil fields.
Wind power generation has also expanded rapidly, given tightening restrictions on CO2 emissions on a global scale. As the world’s largest emitter of CO2, surpassing the United States, China is investing aggressively in wind power generation. This is likely to lead to growing demand for the cables used by wind power generators.
China is also planning an extensive high-speed rail network. This in turn is also expected to prompt a rise in demand for cables used with rolling stock, as domestic production advances.
Moreover, in these rapidly emerging markets, machinery with higher output is now being used. This will lead to rising needs for rubber cable products with higher voltage resistance and durability (against high and low temperatures, oil, and other phenomena).
Given the market circumstances, the Furukawa Electric Group will seek to differentiate itself from its competitors and expand the industrial rubber cable business by combining the powerful manufacturing and sales networks of HT with the material technologies for insulating materials of ultra high-performance cables and ecological wires, manufacturing technologies, and plant management technologies developed by the Company.
Profile of joint venture
Name : Huatong Furukawa (Tangshan) Cable Co., Ltd.
Location Tangshan, Hebei Province, China
Representatives Chairman from HT, President from the Company
Capital 19 million US dollars (about 1.75 billion yen)
Investments HT: 55%; the Company: 30%; SFC: 15%
Businesses Manufacture and sales of rubber wires for mining, oil fields, wind power generation, etc.
Employees About 200
Sales plan 700 million Chinese yuan (about 9.5 billion yen) in 2011
Profile of joint venture partner
Name : Hebei Huatong Wires & *Cables Group Co., Ltd
Location Tangshan, Hebei Province, China
Representatives Chairman: Zhang Wenyong; President: Zhang Wendong
Established 1933 (Relocated to current head office in 2009)
Capital 186 million Chinese yuan (about 2.5 billion yen)
Businesses Rubber wires for voltages below 15kV and plastic wires for voltages of
35kV or less
Employees About 600 (about 200 in rubber wire divisions)
Sales plan 600 million Chinese yuan (about 7.7 billion yen) in 2009
External views of the office and plant of the joint venture Part of the office and plant of HT is being used
Major products of the joint venture
