February 2, 2004

Joint venture for C-GIS and VCB manufacturing established in Shanghai, China

Japan AE Power Systems Corporation (Head Office, Minato-ku, Tokyo; President and Director, Masakazu Mori) has established, with Tianshui Changcheng Switchgear Factory (Tianshui City, Gansu Province; Senior Engineer and Director, Liang Guo Heng), a joint venture company for manufacturing and sales of medium voltage C-GIS (cubicle type gas insulated switchgear) and VCBs (vacuum circuit breaker) in China. This joint venture in China is the first joint venture for Japan AE Power Systems since the company began full-scale operations on October 1, 2002

 

1. Aims of establishment

In China, investments in infrastructure area such as railway, petrochemical and building material industries has been increasing. And the electrical power industries have brisk demands for medium voltage (below 50kV) switchgear products. In particular, the approaching 2008 Beijing Olympics and the 2010 Shanghai Expo are likely to lead to increasing demand for C-GIS products for urban installations.
Japan AE Power Systems has studied establishment of a joint venture with one of the leading manufacturer and seller of medium voltage switchgear in China, Tianshui Changcheng Switchgear Factory, a subsidiary of Lanzhou Great Wall Electrical Co., Ltd. (The latter is listed on the Shanghai Stock Exchange.) Establishing a joint venture in China will enable provision of competitive products through the combination of advanced technology from Japan AE Power Systems and the Chinese mainland sales force of Tianshui Changcheng Switchgear Factory. We also welcome this as an opportunity, while expanding our business on the mainland, to contribute to the electric power industries in China.

 

2. Outline of the new company

Name	Shanghai AE Power Changcheng Switchgear Corporation
Location	Jiading, Shanghai City, China
Line of business	Manufacture and sale of medium voltage C-GIS and VCBs
Establishment	January 20, 2004
Start of production	November 2004 (provisional)
Capital	USD 4.5 million
Investment ratio	Japan AE Power Systems, 60% Tianshui Changcheng Switchgear Factory, 40%.
Representatives	Chairman	Kikkawa Takashi (Executive Managing Director, Japan AE Power Systems)
	Vice Chairman	Zhang Xitai, (General Director, Tianshui Changcheng Switchgear Factory)
	President	Homma Makoto, (Senior Manager, Medium Voltage Switchgear Business Division, Japan AE Power Systems)
Site area	22,000 m2
Number of employees	approx. 40 in FY 2004 (provisional)
Annual sales	JPY 530 million in FY 2005 (forecast)

 

3. Outline of venture partner

Name	Tianshui Changcheng Switchgear Factory
Location	Tianshui, Gansu Province, China
Established	1968
Start of production	November 2004 (provisional)
Capital	CNY 44 million
Annual sales	CNY 320 million in FY 2002
Representative	Liang Guo Heng
Line of business	Manufacture and sale of low and medium voltage switchgear, VCBs, etc.