Sumitomo Metal Industries, Sumitomo Corp to acquire SWAC for $340 million
27 June 2011
Sumitomo Metal Industries and Sumitomo Corp today unveiled p-lans to acquire the holding company of Standard Steel in the US, Steel Wheel Acquisition Corporation (SWAC), for around $340 million.
Standard Steel is one of North America's leading manufacturers of railway wheels and axles with a history of over 200 years.
Osaka-based Sumitomo Metals is one of the world's top manufacturers of railway wheels and axles in Japan and having supplied to Japan's Shinkansen bullet train as well as the Intercity-Express (ICE) trains in Germany.
It had earlier bagged orders to supply wheels for railways in India, Germany and the US.
The acquisition of SWAC is part of Sumitomo Metals' strategy to expand into overseas growth markets with overseas production bases and concurrently to continue to strengthen its core domestic manufacturing bases. It will also help to expand its presence in North America and then to Europe, Asia, and other regions.
Post acquisition, Sumitomo Metals plans to transfer certain technology of SWAC, such as its proprietary SIRD pressing facility, a rotary forging press for wheels, and its ultra clean steel technology, to Standard Steel in order to enhance its global competitiveness in the manufacture and sale of railway wheels, including wheels used for locomotives and passenger trains, including high-speed rail.