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It is our pleasure to announce that the board of Nissho
Iwai Corporation today approved a basic agreement on forming
a comprehensive strategic alliance with Sumitomo Corporation
in the field of the Liquefied Natural Gas (LNG) business.
The details with respect to this transaction including
transfer value are under negotiations and will be reported
after being settled. |
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| 1.
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Purpose
of Transfer and Alliance: |
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To
intensify growth in the LNG business, Nissho Iwai decided
to spin off LNG business and be allied with a strategic
partner from the point of view of long-term expansion.
Nissho Iwai recognizes Sumitomo Corporation as a strategic
partner in LNG business. From now on, through joint management
with Sumitomo Corporation, Nissho Iwai aggressively participate
in new big development projects and making full use of
synergy effect produced by the alliance in order to get
the leading company's position in the industry.
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| 2.
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Scope
of the business transferred to the joint company:
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(1)The
whole LNG business and related investments
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(2)Financial
Results of LNG business as of March, 2001 (millions of
yen) |
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1:
LNG Business |
2:
Company (Non-cosolidated) |
Share
(=1/2) |
| Net
Sales |
468,967 |
4,515,095 |
10.4% |
| Gross
Profit |
3,382 |
87,405 |
3.9% |
| Recurring
Profit |
309 |
16,203 |
1.9% |
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(3)Assets
and Liabilities in LNG business as of March 31, 2001 (millions
of yen) |
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| Assets |
Liabilities |
| Current
Assets |
25,232 |
Current
Assets |
25,420 |
| Fixed
Assets |
10,291 |
Fixed
Assets |
10,103 |
| Total |
35,523 |
Total |
35,523 |
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(4)Methods
of Valuation and Settlement |
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The value and settlement of transfer will be determined
between two companies. |
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| 3.
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Outline
of Joint Venture: |
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Name:
To be determined |
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Ownership:
Nissho Iwai 50 : Sumitomo 50 |
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| 4.
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Schedule:
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June 20, 2001
Board approval |
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July 31, 2001
Conclusion of Transfer Agreement |
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September 30, 2001
Transfer of business |
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| 5.
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Effect
on Earnings forecast: |
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A decrease in net sales by 230 billion yen on a non-consolidated
basis is anticipated with respect to the 2001 fiscal year
(ending in March 2002), the impact on the company's net
profit projection of both consolidated and non-consolidated
basis for 2001 fiscal year will be announced after being
settled. |
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