Metal One Metal One Coporation
September 16, 2008
Construction of Suzhou Metal One Steel Plates Processing Co., Ltd. Plant Begins

Metal One Corporation (headquartered in Minato-ku, Tokyo; president: Moriji Kanada) and Keiyo Blanking Kogyo Co., Ltd. (headquartered in Chiba Prefecture; president: Noriyuki Sato) have established Suzhou Metal One Steel Plates Processing Co., Ltd., a joint venture that will produce melt-cut and processed steel plates for construction machinery in Wujiang, Jiangsu Province, in February 2008 and began the construction of plant facilities in July. Operations are scheduled to start at the beginning of 2009. Metal One launched Hangzhou Metal One Steel Plates Processing Co., Ltd. in Hangzhou in March of last year as a steel plate processing center to primarily serve Hangzhou Kobelco Construction Machinery Co., Ltd., and operations began in November of the same year. The Suzhou Plant will be the second steel plate processing plant for construction machinery in China.

The company will have $10.91 million in capitalization, with Metal One holding a 60% share and Keiyo Blanking Kogyo 40%. It was established on February 4, 2008. The president is Yasumasa Uzaki, on assignment from Metal One, and the vice president is Yoshiaki Katsu, from Keiyo Blanking Kogyo.

Construction of the 15,975-m2 plant, located on a 39,960-m2 site in Wujiang's economic development zone, began in July. For the interim, it will be equipped with two 2-kW laser cutting machines, two 4-kW laser cutting machines, six NC melt-cutting machines, a beveling machine, hydraulic bender, press machine, machining center, welding robot, and shot blasting machine.

A total of approximately $21 million will be invested in the initial phase, with plans for 90 employees. Processing capacity will be roughly 2,000 tonnes per month at launch time, rising to 3,000 tonnes by 2011. To mainly supply customers locally in China, including Caterpillar's Suzhou plant, the first phase's objective is melt-cutting and initial processing. From the second phase, business capacity is scheduled to be expanded to include composite-parts production and distribution operations.

Personnel posted from Keiyo Blanking Kogyo, a Metal One Group member, will offer their experience and expertise to get quality control, the service organization, and other facets of operations on track quickly.

With continuing infrastructure demand related to resource development and emerging economies, demand for construction machinery is expected to remain firm. Flourishing construction and mine development demand is anticipated in China especially, with construction machinery demand remaining high. Demand for hydraulic shovels is projected to increase substantially, from 38,000 in 2006 to 50,000 in 2007 and 100,000 in 2010.

Construction machinery manufacturers are setting up production sites in China to further strengthen their manufacturing operations as part of their efforts to sell fully assembled cars domestically and manufacture composite parts for export.

In the midst of this environment, the newly established company will add depth to melt-cut and processed steel plate and composite component manufacturing operations targeted at the construction machinery industry and will aim to build a global value chain, outlined in Metal One's second Mid-term Consolidated Management Plan, by using a strong domestic foundation and the Group's overall capabilities. Incorporating the steel plate melt-cutting experience and expertise that the Metal One Group has cultivated over many years in Japan, the new company will endeavor to provide the same levels of quality and service that are available in Japan.

Outline of Suzhou Metal One Steel Plates Processing Co., Ltd.
1. Name: Suzhou Metal One Steel Plates Processing Co., Ltd.
2. Headquarters: East to Tongjin Road, South to Xinzi Road, Wujiang Economic Development Zone, Jiangsu Province, China
3. Representative: Yasumasa Uzaki, President (on assignment from Metal One)
4. Capitalization: US$10.91 million
5. Shareholders: Metal One Corporation (60%), Keiyo Blanking Kogyo (40%)
6. Date of establishment: February 2008
7. Start of operation: January 2009 (scheduled)
8. Number of employees: 90 (planned)
9. Line of business: Melt-cutting and processing of steel plates for construction machinery and sales of processed steel plate parts
10. Equipment: 2 2-kW laser cutting machines, 2 4-kW laser cutting machines
6 NC melt-cutting machines
Others: Beveling machine, bender machine, secondary processing equipment (machining center, etc.)
11. Production capacity: 2,000 tonnes per month at launch, 3,000 tonnes per month by 2011 (on a product basis)
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