Distribution-oriented trading companies restructuring according to steel market with more contracted equilibrium
2015/08/04As there has been an enormous amount of surplus steel recently, it seems to become more difficult that trading companies deal with steels and scraps without damaging profitability.
Such an impression was made by the news announced on 3 August that Sumisho Tekko Hanbai Co., Ltd. would succeed their steel raw material business to ITOCHU Metals Corp..
จ@gNotice concerning the conclusion of the basic agreement on business successionh by ITOCHU Metals Corporation (Japanese version only)
More detailed information is in the above news release from ITOCHU Metals Corp, but in short, Sumitomo Tekko Hanbai Co., Ltd. left its steel scrap business off through business restructuring. At the same time, the company decided to integrate the declining domestic steel building material business with Marubeni-Itochu Techno Steel Inc. Distribution has exactly followed the market trend reaching a state of contracted equilibrium.
จ@gIntegration of domestic steel building material businessh by Sumisho Tekko Hanbai Co., Ltd. (Japanese version only)
According to the news release from ITOCHU Metals Corp., the company succeeded metal raw material business (business related to steel scrap trading and general recycling) from ITOCHU Corporation in April 2008.
Having been seeking a next step for further expansion and growth, the company was offered a proposal by Sumitomo Tekko Hanbai and then has conducted considerations and negotiations.
The business to be succeeded has the potential of complementing ITOCHU Metalsf existing business with its excellent operation and performance in Kansai region. ITOCHU Metals considered that to succeed also employees with a great deal of experience in steel scrap business in Tokyo and other regions would contribute not only to the business expansion but also much to the development of the whole company.
Meanwhile, considering restructuring its building material business and steel raw material business, the Sumitomo Tekko Hanbai concluded that to succeed its steel raw material business to ITOCHU Metals would lead to restructure its building material business and to strengthen and increase the competitiveness of its steel raw material business.
The business will be succeeded on 1 January 2016 through licensing procedures and approval process.