Nippon Chuzo Enters Capital Alliance with Hitachi Construction Machinery

Japanese major cast steel maker, Nippon Chuzo announced on Thursday the company concluded the capital and business alliance with Hitachi Construction Machinery. Nippon Chuzo will construct a new factory for construction machinery parts inside Kawasaki plant, Kanagawa Prefecture and organizes the production line prior to Hitachi Construction Machinery. The plant construction will start in June 2012 and complete in March 2013. The investment is approximately 1.05 billion yen.

The demand is expected to increase largely for cast steel parts used for large mining machineries. Nippon Chuzo enhances global partnership with Hitachi Construction Machinery and targets higher quality, lower price and healthy volume growth of cast steel sold to Hitachi Construction Machinery. Nippon Chuzo has accepted cast steel parts orders from Hitachi Construction Machinery and manufactured the parts at Japanese own plans and offshore OEM partners since 2011.

Nippon Chuzo will allocate 9.292 million new shares to Hitachi Construction Machinery on July 2 at approximately 1.05 billion yen. Hitachi Construction Machinery will hold 18.13% voting power and become the secondly largest shareholder of Nippon Chuzo.