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Press Release 2012

Home > Press Release > 2012 > March 23

Establishing Joint Venture of Cutting Tools in Indonesia

March 23, 2012

Sumitomo Electric Industries, Ltd.

Sumitomo Electric Industries, Ltd. has agreed with PT. Somagede Indonesia to establish a joint venture that manufactures cutting tools in the Republic of Indonesia.

Sintered diamond inserts “SUMIDIA”Carbide cutting tools, such as inserts and drills as well as cubic boron nitride (CBN) and sintered diamond tools, are widely used for machining automotive components and other mechanical parts.

 

The Sumitomo Electric Group has expanded its cutting tools business from Japan to Europe, North America and Asia, and has supplied a variety of cutting tools to automakers, auto parts manufacturers and other industrial customers around the world. It has thus far supplied the Indonesian market through its Thai plant.

 

In Indonesia, however, the recent progress in motorization has boosted the local auto production and prompted foreign auto parts manufacturers to tap into the market, spurring the growth in demand for cutting tools. In light of this situation, the Sumitomo Electric Group has decided to collaborate with Somagede Indonesia, a trading company dealing with cutting tools and other industrial products, to jointly establish a company that manufacture cutting tolls in the country. This joint venture aims to strengthen our production and supply systems, provide customers with improved technical services, and extend our sales networks.

 

The new company plans to gain a large share in the Indonesian market by supplying a wide range of products including cemented carbide drills for steel and cast iron, CBN inserts used in machining hardened steel and cast iron parts, and sintered diamond inserts used in turning aluminum parts.

 

In parallel with this joint venture, we will also launch a new company to provide sintered parts in Indonesia. We expect that these two industrial materials businesses will create various synergies particularly in the sales expansion of cutting tools and facilitating material procurement.

 

Profile of New Company

Company name PT. Sumiden Hardmetal Manufacturing Indonesia (provisional name)
Location Karawang Industrial Park, Karawang, West Java, the Republic of Indonesia
President Undecided
Business Design, manufacturing, maintenance and sales of cemented carbide tools, sintered diamond tools and CBN sintered tools
Capital 7.5 million US dollars (approx. 600 million yen, 1 US dollar = 80 yen)
Investment ratio Sumitomo Electric Hardmetal Corporation: 80%, PT. Somagede Indonesia: 20%
Establishment June 2012 (scheduled)
Start of operation April 2013 (scheduled)
Employees Approx. 100 in FY 2014
Prospective sales Approx. 700 million yen in FY 2015

 

・SUMIDIA is a trademark or registered trademark of Sumitomo Electric Industries, Ltd.

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