TOKYO - Sumitomo Metal Industries Ltd. said today it will enhance its relationship with China Steel Global Trading Corp. by selling part of its 67 percent stake in its Thai subsidiary to the Taiwanese firm later this month.
China Steel Global, a key company in the China Steel Corp. group, will acquire a 15 percent stake in the SumitomoMetal unit, Thai Sumilox Co., on Aug. 31, the Japanese company said. Thai Sumilox, based in Ayutthaya, processes and markets electromagnetic steel components for use in home electrical appliances.
The value of the transaction has not been revealed.
Sumitomo Metal has been expanding Thai Sumilox's production capacity to meet growing demand mainly among Japanese electrical appliance makers for their plants in East Asia.
The company also plans to increase procurement of steel plates from China Steel, it said.
Sumitomo Metal also said it is considering investing in a steel plate-processing company to be set up by the China Steel group in Ho Chi Minh City, Vietnam, in the middle of 2008.