Suzuki Metal Acquires Garphyttan, Top Maker of Valve Spring Wire

Nippon Steel Corporation announced on 25 December that Suzuki Metal Industry, the affiliate company of Nippon Steel, acquires Haldex Garphyttan, Swedish valve spring wire maker, at 800 million Swedish Kronor (approximately 9 billion yen). Garphyttan is the world largest supplier of valve spring wire operating in Europe, North America and China. Suzuki Metal will become the world top maker of valve spring wire by this acquisition. Suzuki Metal will raise partial acquisition fund by share issue through third party allotment to Nippon Steel. As a result, Suzuki Metal will become a consolidated subsidiary of Nippon Steel.

Suzuki Metal concluded a stock purchase and sale agreement with Haldex, a parent company of Garphyttan, on 25 December. Suzuki Metal will purchase all stocks of Garphyttan. The acquisition worth will be fixed after the adjustment of interest-bearing debts. The procedure is scheduled to finish for April-June 2009.

Suzuki Metal is Japanese top maker of special wire products including automotive valve spring wire, whose around 35% share is held by Nippon Steel. Nippon Steel supplies steel wire rod to Suzuki Metal. Suzuki Metal aims to enhance its presence in global valve spring wire market by this acquisition, expecting the new demand from non-Japanese automobile related makers and the establishment of the more effective production network. The firm expects the long and steady market growth, though the demand is currently weakening.

Haldex is a maker of brake systems and hydraulic systems for commercial vehicles and Garphyttan is the subsidiary to manufacture special wire products. Garphyttan posted annual revenue at 19.3 billion yen and annual recurring profit at 1 billion yen for 2007.