Commencement of Consideration of Business Integration of Nisshin Steel Co

Commencement of Consideration of Business Integration of Nisshin Steel Co., Ltd. and Nippon Metal Industry Co., Ltd.

Nisshin Steel Co., Ltd. (Location: Chiyoda-ku, Tokyo; President: Toshinori Miki) (“Nisshin”) and Nippon Metal Industry Co., Ltd. (Location: Chiyoda-ku, Tokyo; President: Hiroshi Yoshimura) (“Nikkinko”) (collectively, “Companies”) have entered into a basic agreement today to begin the consideration for integration of their businesses (“Business Integration”) targeted for October 1, 2012, assuming that the Companies obtain the approvals such as approvals of their respective shareholders at the shareholders’ meeting and approvals of relevant authorities including the Japan Fair Trade Commission. The Companies will give concrete considerations to the Business Integration in the spirit of equal partnership.

Rule 802 Legend

This exchange offer or business combination is made for the securities of a foreign company. The offer is subject to disclosure requirements of a foreign country that are different from those of the United States. Financial statements included in the document, if any, have been prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.

It may be difficult for you to enforce your rights and any claim you may have arising under the federal securities laws, since the issuer is located in a foreign country, and some or all of its officers and directors may be residents of a foreign country. You may not be able to sue a foreign company or its officers or directors in a foreign court for violations of the U.S. securities laws. It may be difficult to compel a foreign company and its affiliates to subject themselves to a U.S. court’s judgment.

You should be aware that the issuer may purchase securities otherwise than under the exchange offer, such as in open market or privately negotiated purchases.

The new company created as a result of Business Integration (“Integrated Company”) will endeavor to achieve the following goals in order to develop a firmer business platform by integrating business resources, to become No. 1 manufacturer in stainless steel business in Japan overall (i.e., technology, development, marketing and earnings), to make a leap to become one of the top stainless steel manufacturers in the world, and to ensure stable product quality, cost and service to domestic and oversea customers:

The Integrated Company will give all efforts to promptly achieve the above goals and to obtain maximum synergy effects as soon as possible by unifying the Companies which are steel manufacturers with a long history in the stainless steel business.

The Companies will work toward Business Integration in accordance with the following details, assuming that the Companies obtain the approvals of their respective shareholders at the shareholders’ meeting and approvals of relevant authorities:

The Companies will establish a holding company by jointly transferring their respective shares and will become wholly-owned subsidiaries of such holding company. As a result, the Companies will delist themselves, and the holding company, which will become the wholly-owning parent company of the Companies, is scheduled to apply for new listing.

The Companies will also execute a share transfer agreement and complete the drafting of share transfer plan by April 2012 at the latest and will respectively hold shareholders’ meetings in order to obtain the approvals for Business Integration as soon as possible.

However, if any event occurs which will make the promotion of Business Integration plan practically impossible in the course of proceeding with the procedures and discussions on Business Integration due to problems relating to the filings with (including filings under the non-Japanese laws), or procurement of approvals from, the relevant authorities such as the Japan Fair Trade Commission or due to other reason or if any other significant problem arises which may cause the achievement of objectives of Business Integration to become very difficult, there is a possibility that the Companies will amend the Business Integration plan including the schedule or will reconsider the promotion of Business Integration, upon good faith discussion and agreement between the Companies.

The Companies will decide on the Business Integration ratio (i.e., number of shares in the holding company which the shareholders of respective Companies will receive upon share transfer of their shares in the Companies) upon discussion by taking into account the assessments and advices of third parties to be appointed respectively by the Companies.

The integration study committee will be formed with the presidents of Companies as joint chairpersons and will begin the study on matters such as organizational structure and business outlook after the Business Integration. The earnings forecast of holding company will be announced as soon as it is determined by taking into account factors such as the results of assessment of the integration study committee.

Any undecided matters on the Business Integration will be announced as soon as they are decided.

This document includes “forward-looking statements” that reflect the plans and expectations of Nisshin and Nikkinko in relation to, and the benefits resulting from, their possible Business Integration described above. To the extent that statements in this press release do not relate to historical or current facts, they constitute forward-looking statements. These forward-looking statements are based on the current assumptions and beliefs of the Companies in light of the information currently available to them, and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause the actual results, performance, achievements or financial position of one or both of the Companies (or the post-transaction group) to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. The Companies undertake no obligation to publicly update any forward-looking statements after the date of this document. Investors are advised to consult any further disclosures by the Companies (or the post-transaction group) in their subsequent domestic filings in Japan and filings with the U.S. Securities and Exchange Commission.

The risks, uncertainties and other factors referred to above include, but are not limited to:


– November 15, 2011:		Execution of letter of intent on the commencement of consideration of Business Integration (executed today)

– October 1, 2012:		Effective date of Business Integration



Nisshin Steel Co., Ltd.:		Public & Investor Relations Team of General

		Administration & Risk Management Department

		Tel: +81-3-3216-5566

Nippon Metal Industry Co., Ltd.:		IR Section of Corporate Planning Department

		Tel: +81-3-3500-5645


(1) Name	Nisshin Steel Co., Ltd.	Nippon Metal Industry Co., Ltd.

(2) Location	4-1, Marunouchi 3-chome, Chiyoda-ku, Tokyo 100-8366	2-6, Kasumigaseki 3-chome, Chiyoda-ku, Tokyo 100-8937

(3) Name of Representative	Toshinori Miki Representative Director and President & Chief Executive Officer	Hiroshi Yoshimura Representative Director and President

(4) Business Description	Manufacturing, processing and sales of steel products and other business incidental thereto	Manufacturing, processing and sales of stainless steel, heat resistant steel and any other metal products

(5) Capital	79. 913 billion yen (as of March 31, 2011)	13.408 billion yen (as of March 31, 2011)

(6) Date of Establishment	February 15, 1928	June 15, 1932

(7) Total Number of Issued Shares	994,500 thousand shares (as of March 31, 2011)	185,605 thousand shares (as of March 31, 2011)

(8) Date of Fiscal Year End	March 31	March 31

(9) Number of Employees	6,074 (3,665 on a non-consolidated basis) (as of March 31, 2011)	822 (622 on a non-consolidated basis) (as of March 31, 2011)

(10) Main Customers	Metal One Corporation Nihon Teppan Co., Ltd. Hanwa Co., Ltd.	Marubeni-Itochu Steel Inc. Metal One Corporation Sumitomo Corporation

(11) Main Banks	The Bank of Tokyo-Mitsubishi UFJ, Ltd. Mizuho Corporate Bank, Ltd. The Sumitomo Trust & Banking Co., Ltd. Mitsubishi UFJ Trust and Banking Corporation	Resona Bank, Limited The Bank of Yokohama, Ltd. The Sumitomo Trust & Banking Co., Ltd. Mitsubishi UFJ Trust and Banking Corporation


(12) Principal Shareholders and Shareholding Percentage	Nippon Steel Corporation	9.17%	Nisshin Steel Co., Ltd. Nikkinko’s Customers Shareholding Association Metal One Corporation Resona Bank, Limited The Bank of Yokohama, Ltd. Marubeni-Itochu Steel Inc. Hanwa Co., Ltd. Taiyo Stainless Spring Co., Ltd. Chofu Seisakusho, Ltd. Maruzen Showa Unyu Co., Ltd. (as of March 31, 2011)	5.12% 4.73% 3.44% 2.44% 2.44% 2.20% 1.88% 1.81% 1.73% 1.72%
	Japan Trustee Services Bank, Ltd. (account in trust)	5.88%
	The Master Trust Bank of Japan, Ltd. (account in trust)	3.12%
	Taiyo Life Insurance Company	2.66%
	The Bank of Tokyo- Mitsubishi UFJ, Ltd.	2.48%
	Nippon Life Insurance Company	2.01%
	Mizuho Corporate Bank, Ltd.	1.78%
	Nipponkoa Insurance Co., Ltd.	1.58%
	Japan Trustee Services Bank, Ltd. (account in trust No. 9)	1.36%
	Sumitomo Life Insurance Company	1.31%
	(as of March 31, 2011)


(13) Relationship between the Companies

Capital Ties		As of March 31, 2011, Nisshin Steel Co., Ltd. holds 9,500,000 shares representing 5.12% of issued shares in Nippon Metal Industry Co., Ltd., and Nippon Metal Industry Co., Ltd. holds 5,000,000 shares representing 0.50% of issued shares in Nisshin Steel Co., Ltd.

Personnel Ties		No notable personnel ties exist between Nisshin Steel Co., Ltd. and Nippon Metal Industry Co., Ltd. No notable personnel ties exist between the person or company related to Nisshin Steel Co., Ltd. and the person or company related to Nippon Metal Industry Co., Ltd.

Business Ties		Nisshin Steel Co., Ltd. and Nippon Metal Industry Co., Ltd. are engaged in transactions under which they have consignor/consignee relationship for the supply and manufacture of parts of semi-finished products and finished products of stainless steel.

Status Applicable to the Related Parties		Nippon Metal Industry Co., Ltd. and people and companies related to Nippon Metal Industry Co., Ltd. are not parties related to Nisshin Steel Co., Ltd. Nisshin Steel Co., Ltd. and people and companies related to Nisshin Steel Co., Ltd. are not parties related to Nippon Metal Industry Co., Ltd.