July 20, 2011
Furukawa Electric and its 100% subsidiary Furukawa Magnet Wire Co., Ltd. ("FMGW") have decided to strengthen overseas business development under the FMGW brand by having FMGW obtain shares of Jung Shing Wire Co., Ltd. (headquartered in Taiwan; hereinafter "Jung Shing Wire") and collaborating in the fine enameled wire business in the Chinese market.
1. Background and objectives
Manufacture of fine enameled wire is consigned to Jung Shing Wire, for strengthening sales of the products in China.
- From April 2010, our company and FMGW have integrated the magnet wire businesses of the Furukawa Electric Group in efforts to strengthen this business area. Demand for fine enameled wire in the Chinese market has grown steadily, mainly for use with electronic components, as a result of wider use of such components with on-vehicle equipment and Smartphone. We expect demand will remain steady in the future.
- Under these circumstances, we have decided to strengthen overseas business development under the FMGW brand by collaborating with Jung Shing Wire and consigning manufacture of fine enameled wire to its manufacturing bases in China.
- FMGW will acquire about 31 million ordinary shares of Jung Shing Wire held by Totoku Electric Co., Ltd. This is equivalent to a little over 20% of all outstanding shares.
2. Outline of business collaboration and future plans
Sequential shipment of samples is set to start this September.
- Jung Shing Wire has three manufacturing bases in Taiwan (Tainan) and China (Suzhou and Dongguan). Manufacture of products shipped in China is to be consigned to the manufacturing bases in Suzhou and Dongguan.
- The object of business collaboration is fine enameled wire (with a radius of 0.5 mm or less), for which the market is expected to expand in the coming years and an area in which FMGW and Jung Shing Wire show strength.
- Our sales network in China will be utilized for sales, delivering products to customers in China directly. The product brand will be FMGW, which will design the products and guarantee their quality.
- Shipment of samples will start in sequence this September. Two types of products that have enjoyed wide acceptance in the Chinese market will be manufactured - self-bonding wire (SV, LOCK) and ultrafine polyurethane enameled wire (UEW). Targeted monthly production of 500 metric tons is to be attained within a few years.
3. Profile of Jung Shing Wire
This major Taiwanese company with two productions bases in China develops, manufactures and sells enameled wire.
- Head office : No. 231, Section 3, Chung-cheng Road, Jen-teh District, Tainan City 71757, Taiwan
- Chairman : Tong-Shien Wang
- Plants : Taiwan (Tainan main plant), China (Dongguan, Suzhou)
- Capital : NT$1,402 million
- Scope of business : development, manufacturing and sales of enameled wire and Litz wire