Kobe Steel to form joint venture in China

Kobe Steel to form joint venture in China

Japanese steel producer Kobe Steel is planning to establish a joint venture company in Guangdong province of China to process special steel wire rods for the automotive industry. It is reported that steel trader Metal One Corporation and wire rod processors Kyodo Shaft Co and Sugita Wire Ltd will hold equities in the joint venture company, which will temporarily be called Kobe Wire Products Co Ltd. Kobe Steel, Metal One, Kyodo Shaft Co and Sugita Wire Ltd will hold 60%, 25%, 7.5% and 7.5% equity in the new company, respectively. The joint venture company will produce cold drawn steel bar and cold heading quality steel wire. The processed bar and wire will be supplied to Japanese auto parts producers in China. The new company, which is planned to be established in November with an investment of Yen 1.8 billion ($17 million), will have a registered capital of Yen 725 million ($6.8 million). Production at the company is expected to begin in April 2006.