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Mitsui & Co., Ltd. ("Mitsui", head office: Chiyoda-ku, Tokyo, President and CEO: Masami Iijima) has signed a joint venture agreement with OAO Severstal ("Severstal". head office: Cherepovets, Volodga Region, Russia, CEO Alexei Mordashov) to establish a new steel service center for automobile steel in Leningrad Oblast, close to St. Petersburg, the second largest city in the Russian Federation. The charter capital of the new service center will be 970 million rubles (approximately 2.5 billion yen), and operations are targeted to begin in the middle of 2013. The annual capacity of this service center will be 170,000 MT. With this agreement, Mitsui will be the first Japanese trading company to participate in a steel service center in Russia.
Russia's automotive sales temporarily declined after the world financial crisis. However, they are expected to increase to 3 million vehicles in 2016, making Russia's automotive market the 7th largest in the world. Many foreign car manufacturers are located in the Russian northwest area, and with the Russian government promoting local procurement, demand for steel processing is anticipated to grow.
With Mitsui's worldwide experience operating steel service centers and Severstal's stable steel supply and technical capabilities, Mitsui and Severstal will combine their strengths to participate in the development of the Russian automotive industry and strengthening of the steel service center base in the Russian market.
|Head office||Leningrad region, Vsevolozhsk|
|Representative||To be appointed from Severstal|
|Investment||Mitsui 25%, Severstal 75%|
|Charter Capital||970 million rubles (approximately 2.5 billion yen)|
|Business activity||Steel processing and sales for the automotive industry|
|Date of establishment||Established in 1992 (listed in the LSExchange)|
|Address||Cherepovets, Vologda region, Russia|
|Business Activities||Steel manufacturing (mills in Russia, Kazakhstan, US, and Europe), development of raw materials such as iron ore and coal (iron ore, coal, gold, nonferrous mines in Russia)|
|Crude steel production||14.7million MT (actual production in 2010)|
|Sales||13.57 billion USD (2010)|
|Total Assets||19.32 billion USD (2010)|
This announcement contains forward-looking statements. These forward-looking statements are based on Mitsui's current assumptions, expectations and beliefs in light of the information currently available to it and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause Mitsui's actual results, financial position or cash flows to be materially different from any future results, financial position or cash flows expressed or implied by these forward-looking statements. These risks, uncertainties and other factors referred to above include, but are not limited to, those contained in Mitsui's latest Annual Securities Report and Quarterly Securities Report, and Mitsui undertakes no obligation to publicly update or revise any forward-looking statements.
This announcement is published in order to publicly announce specific facts stated above, and does not constitute a solicitation of investments or any similar act inside or outside of Japan, regarding the shares, bonds or other securities issued by us.