Aichi Steel Funds 30 Billion Yen to Expand Steels and Forgings Output

Aichi Steel announced on Thursday it issues unsecured convertible bonds with share warrant for the 5th time. The firm raises totally 30 billion yen with the bond issue in order to strengthen output equipment for special steel and forged auto parts, when Toyota Motor Corporation, the main customer for Aichi Steel, increases the output domestically and abroad.Aichi Steel plans to invest 17 billion yen for steel products, 21.7 billion yen for forgings and 5.4 billion yen for electro magnetic products, the largest investments so far. The firm will expand the output capacity of steel products by around 15% to 1.3 million tonnes in fiscal 2007 ending March 2008 from 2004. The firm renews the transformer of no.3 electric furnace and improves the steel output capacity of the furnace from 70,000 to 90,000 tonnes per month toward March 2006 with 3 billion yen of investment. The firm increases purifying lines of no.2 line mill toward August 2006 with 5.8 billion yen and renews the blooming heating furnace to August 2006 with 2.4 billion yen.Aichi Steel will expand the output capacity of forged parts by 30% to 380,000 tonnes in fiscal 2007 from 2004. The firm plans to establish the automatic press line with 3,000 tonnes capacity at no.6 forging plant in January 2007 with 1.2 billion yen of investment. The firm also strengthens no.6 forging plant toward May 2007 with 3.2 billion yen, establishes no.7 forging plant and no.3 refining plant to September 2007 with 11.4 billion yen and introduces no.8 rolling mill line in February 2008 with 1.9 billion yen.