Sumitomo Metals Starts Considering the Subscription of Preferred Shares of SUMCO
Today, the Board of Directors of Sumitomo Metal Industries, Ltd. (Sumitomo Metals) decided to start considering the subscription of 15 billion yen in preferred shares of SUMCO Corporation (SUMCO), following their request. SUMCO is an equity-method affiliate of Sumitomo Metals.
1. Reasons to consider subscription for the third-party allotment of preferred shares
SUMCO has announced its “Business Reorganization Plan” that focuses on the withdrawal from some business, consolidation of production sites, and measures concerning its workforce. As a result, the net worth of SUMCO is expected to decrease significantly. In response to this, SUMCO decided to request subscription for its issuance of preferred shares by a third-party allotment.
Sumitomo Metals decided to consider accepting SUMCO’s request of subscription for the preferred shares of 15 billion yen as we believe the execution of “Business Reorganization Plan” and improvement of SUMCO’s profitability will lead to increase its corporate value. Details such as terms and conditions of the preferred shares will be announced as soon as they are determined.
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