JFE Steel Corporation today announced that it has entered into a share purchase agreement with Riken Corporation under which a portion of its shares in JFE Pipe Fitting Mfg. Co., Ltd. will be transferred to Riken Corporation on March 31, 2023, leaving JFE Steel with a 9.994% stake in JFE Pipe Fitting. The move is part of JFE Steel’s plan to deploy its corporate resources more efficiently and strategically.

JFE Pipe Fitting, founded in 1935, produces high-quality fittings and prefabricated piping under its Ring brand as a specialized manufacturer of piping systems within the JFE group. With the Japanese population now in decline, the domestic market for piping systems is expected to shrink over the long term. JFE Pipe Fitting aims to develop new products, optimize its production systems and generate new demand, thereby securing sustainable growth.

Riken manufactures automotive and industrial machinery parts, such as piston rings. Under its PLAN2022 medium-term business plan, the company is working to expand its business in automotive fields in principle not centered on internal combustion engines, focusing on areas with which the company has high affinity. The company expects to benefit from solid demand over the medium to long term in view of the important roles many of its piping products play in supporting critical infrastructure. Given the underlying potential for strong growth through the development of new products, Riken aims to strengthen and expand its piping business as the company’s core field.

JFE Steel has determined that the share transfer will create synergistic opportunities for sustainable growth by allowing JFE Pipe Fitting to collaborate with Riken in order to enhance the competitiveness of its own pipe-fitting products and high-performance casting products as well as to develop new products.

JFE regards the FY2021—FY2024 term of its Seventh Medium-term Business Plan as the most transformative period in the company’s history, during which time the company is actively reorganizing its business foundation. In the steel business, JFE is intensively focusing resources on key priorities, including transitioning to a more robust business structure and working toward carbon neutrality to help tackle climate change.

The company is pursuing a balanced approach that combines financial soundness and strategic investment aimed at achieving sustained growth and increased corporate value over the long term.

Overview of JFE Pipe Fitting Mfg. Co., Ltd.

• Business	：Manufacture and sale of fittings for gas, water and other piping; parts for architectural and industrial machines; and processing of prefabricated pipes
• Head office	：153-1 Tajimecho, Kishiwada-shi, Osaka Prefecture
• CEO	：Takumasa Terauchi
• Consolidated sales (FY ending March 2022)	：12,469 million yen
• Capital	：959 million yen
• Employees (consolidated)	：499
• Ownership	：JFE Steel Corporation 86.55%, Osaka Gas Co., Ltd. 6.06%, Sompo Japan Insurance Inc. 2.50%, Shinwa Sangyo Co., Ltd. 1.56%, Aioi Nissay Dowa Insurance Co., Ltd. 1.25%, Furubayashi Sangyokigu Co., Ltd. 1.04%, and OTEC 1.04%

Overview of Riken Corporation

• Business	：Manufacture and sale of automotive parts and other industrial parts
• Head office	：8-1 Sanbancho, Chiyoda-ku, Tokyo
• CEO	：Yasunori Maekawa
• Consolidated sales (FY ending March 2022)	：78,372 million yen
• Capital	：8,573 million yen
• Employees (consolidated)	：4,332
• Ownership	：The Master Trust Bank of Japan, Ltd. (trust account) 11.63%, Mizuho Bank, Ltd. 4.86%, Custody Bank of Japan, Ltd. (trust account) 4.54%, Nippon Life Insurance Company 4.29%, Daishi Hokuetsu Bank, Ltd. 3.20%, Sumitomo Mitsui Trust Bank, Limited 2.62%, MUFG Bank, Ltd. 2.55%, Riken Kashiwazaki Holding Association 2.22%, Sompo Japan Insurance Inc. 1.90%, and DFA International Small Cap Value Portfolio 1.82%

About JFE Steel Corporation

JFE Steel Corporation, one of the world’s leading integrated steel producers, was established through the consolidation of NKK Corporation and Kawasaki Steel Corporation in 2003. The company operates several steelworks in Japan and numerous branch offices and affiliates throughout the world. JFE Steel leverages world-class technologies and know-how to produce a wide range of products based on its “Only One, Number One” strategy of focusing on unique and best-in-class products. The company reported consolidated sales of 2,255 billion yen and consolidated crude steel output of 23.96 million tons in the fiscal year ended March 2021.

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