Sumitomo Corporation to invest in silicon steel processing company in Turkey

Sumitomo Corporation (Head office: Chuo-ku, Tokyo / President & CEO: Kuniharu Nakamura) and Sumitomo Corporation Dis Ticaret A.S. (Head office: Istanbul / Chairman Noboru Saka), in cooperation with MKS Transformer Equipments Industry and Trade Joint Stock Company (Head office: Sekerpinar Industrial Zone, Kocaeri, Gebze, / President: Korhan Akgun / hereinafter “MKS”), a silicon steel processing company in Turkey, have agreed to acquire a share in MKS.

MKS possesses facilities such as slitting lines, core cutting lines and core stacking lines, to process mother silicon steel coil, which is mainly used for the iron core of electrical transformers. As MKS has facilities to accomplish continuous process, from slitting to core stacking, it is possible to process silicon steel as per the customer’s needs and deliver it “Just In Time.” Sumitomo Corporation aims to expand the sales of silicon steel produced by Nippon Steel & Sumitomo Metal Corporation, its major supplier of steel, to the domestic markets of Turkey and its neighboring countries, by utilizing the facilities, location and expertise of MKS.

In the global trend of energy-saving and environmental protection, the Eco design requirement, a regulation pertaining to the efficiency of transformers, will enter into force from Jul. 2015 in the European Union. The regulation increases the demand of high quality silicon steel, with export to Europe indicated.  
Also, it is expected that demand for electricity in Turkey will increase an average of 7% per year due to increased population, economic growth and industrial conversion to heavy industries. Such an environment increases the necessity to build/equip new power plants and grids. At the same time, Turkey has several production sites for transformers, with investments from European heavy electric companies.
In addition, demand for electricity in the Middle East and Africa will increase due to increasing populations. Turkey is a good location from which these markets can be targeted for export of its transformers and steel cores.

Sumitomo Corporation already possesses silicon steel processing/sales companies in the United States, Mexico, China, and Indonesia. By acquiring a share in MKS, our processing sites will have access to the main markets for silicon steel. Sumitomo Corporation aims to further expand sales of its electrical steel globally.