Date: 2013-08-19

NSK Concludes a Capital Tie-Up with a Chinese Bearing Manufacturer

 NSK Ltd. announced today that it concluded an agreement on February 2, 2013 to establish a capital tie-up in the bearings business with Ningbo MOS Group Corporation Limited, a leading private bearing manufacturer in China. Through this agreement, NSK will acquire a 25% stake in MOS. Details are as follows.

 

1. Reasons for the capital tie-up.

 

In recent years, the high-performance bearing market, which is dominated by Japanese, U.S. and European bearing manufacturers, as well as the so-called high-volume market in China have been growing rapidly.

In this context, NSK acquired a 10% stake in Gongzhuling Bearing Co., Ltd. (Headquarters: Gongzhuling City, Jilin Province, China; President: Li Gang; hereafter, "Gongzhuling Bearing"), an automotive bearing manufacturer in the MOS Group. Both NSK and Gongzhuling Bearing have been promoting their business partnership to manufacture products for the Chinese market.

On this basis, NSK has recently decided to further expand and strengthen its business alliance with MOS, which is a highly competitive manufacturer of small-size bearings and other products.

 

2. Objectives of the capital tie-up.

 

By strengthening its business alliance with the MOS Group, a leading private conglomerate based in China, NSK intends to pursue the manufacturing operations required to make a full-scale entry and expansion into the high-volume market in China, as well as to build on its know-how in relation to the market while developing a network of suppliers.

 

3. Summary of the capital tie-up.

 

After concluding the capital tie-up agreement, NSK will acquire 25% of MOS's outstanding shares (valued at about 1 billion yen), and form a capital tie-up in the bearing business, encompassing manufacturing and sales.

 

4. Future outlook.

 

The capital tie-up is expected to improve the competitiveness of both companies, especially over the medium and long term. Its impact on NSK's financial results in the current fiscal year is expected to be insignificant.

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