NSK Plans to Acquire 10% Stake in Chinese Bearing Manufacturer Gongzhuling Bearing Co., Ltd.
TOKYO, April 24, 2012 /PRNewswire/ — NSK Ltd. (NSK; Headquarters: Tokyo, Japan; President and CEO: Norio Otsuka) announced that it has decided to acquire a 10% stake in Gongzhuling Bearing Co., Ltd. (Headquarters: Gongzhuling City, Jilin Province, China; President: Li Gang; Hereafter, “Gongzhuling Bearing”), a subsidiary of Ningbo MOS Group Corporation Limited (Headquarters: Zhuangshi Zhenhai District, Ningbo City, Zhejiang Province, China; President: Li Gang; Hereafter, “the MOS Group”). NSK plans to acquire new shares issued by Gongzhuling Bearing through a third-party allotment scheduled for conclusion in June 2012.
Ownership Structure of Gongzhuling Bearing Co., Ltd. --- Current Ownership after NSK's ownership acquisition of shares in June 2012 ------------ MOS Group 70% 63% ----- --- --- Jilin Province 30% 27% -------- --- --- NSK 0% 10% --- --- ---
At the signing ceremony for the acquisition agreement, Tsutomu Komori, Executive Vice President in charge of NSK’s Automotive Business Division Headquarters, said: “NSK has the top market share for bearings in China. We are aiming to double our current level of sales in China to 200 billion yen by NSK’s centenary in 2016. By establishing this partnership with Gongzhuling Bearing, we hope to further deepen our understanding of the Chinese market and to further contribute to the country’s economic development. Through our collaboration with Gongzhuling Bearing, NSK aims to identify future trends in the market as quickly as possible. In tandem with China’s further growth, NSK will continue on its path to becoming a true insider in the Chinese market.”
Gongzhuling Bearing President Li Gang remarked: “It is a great honor to offer a stake in our company to NSK, a world-leading bearing manufacturer. We already have a strong presence in the high-volume market. By collaborating with NSK, with its globally advanced technological capabilities, we can now also target the high-end market which has been difficult for us to enter on our own in the past. Gongzhuling Bearing and NSK are an ideal match, as we can pursue wider segments of the Chinese market through collaboration.”
NSK is the third largest bearing manufacturer in the world. Having a global number-one share in automotive bearings and the number-two share in steering systems, NSK provides a wide range of automotive components to customers globally. In China, NSK sells automotive bearings such as hub unit bearings as well as electric power steering and other steering systems. Gongzhuling Bearing supplies a wide variety of automotive bearings to Chinese automobile manufacturers.
With the further growth of the automobile market in China, highly advanced automotive technologies are being introduced. In the high-volume segment, cost performance has been the top priority until now. However, high functionality such as lower fuel consumption and product durability are becoming more and more important. This development is leading to significant changes in the Chinese market environment.
Established in 1916, NSK produced the first ball bearings made in Japan. Over its history, NSK has developed a wide range of bearings and supplied them around the world, making significant contributions to the development of industry and advancements in machinery. At present, NSK holds the top market share in Japan and the third largest share in the world for bearings. By applying its high precision processing technologies refined over many years of manufacturing bearings, NSK began diversifying into automotive products and precision machinery and parts at an early stage. The NSK Group has been aggressively expanding beyond Japan since the 1960s, and currently operates 62 production sites in 12 countries. NSK’s roots in China stretch back over 40 years, when it began providing technologies to the country’s state-owned industries. Now, with 12 production sites and 19 sales sites in China, NSK is contributing to the development of many kinds of industries throughout the country, including automobiles and industrial machinery.
About the MOS Group
The MOS Group is a bearing manufacturer based in Zhejiang Province, China. Originally specializing in small diameter ball bearings for office equipment, the group currently has the top market share among domestic manufacturers in China’s small-bearing market, and also exports beyond China. In recent years, the MOS Group has been undertaking mergers and acquisitions to aggressively enter the truck bearing, precision machinery bearing, and large-size bearing markets. In taking this direction, the group is manufacturing larger size bearings for automobiles, machine tools, and wind power generation facilities, in addition to the office equipment bearings it has produced in the past. The MOS Group operates seven factories and recorded sales equivalent to almost 10 billion yen in 2011.
About Gongzhuling Bearing Co., Ltd.
Gongzhuling Bearing was established in 1958 in Jilin Province, China, as a state-owned enterprise. Since that time, Gongzhuling Bearing has expanded its supply of automotive bearings to major manufacturers, including the First Automobile Works Group, Dongfeng Motor Corporation, and the China National Heavy Duty Truck Group. Gongzhuling Bearing was privatized in 2008, and the MOS Group acquired a 70% stake while the remaining 30% stake was acquired by Jilin State-owned Asset Management Co., Ltd. Sales in 2011 amounted to approximately 4 billion yen.