Developing Business Infrastructure to Meet Growing Demand for Construction Steel

Inauguration ceremony on June 30 (Foreground, left to right: Mr. Nguyen Hoang Nhan, senior expert of the Foreign Investment Division in the Department of Planning and Investment of Ho Chi Minh City, and Mr. Yamashita, general director of MOV)

Outline of the New Company Name: Metal One (Vietnam) Co., Ltd. (MOV) Representative: Yutaka Yamashita, general director Bases: Head office in Ho Chi Minh City Branch office in Hanoi Business office in Vung Tau Capital: US$2 million (Metal One: 100%) Number of employees: 17 Main businesses: Import and sales of steel scrap, billets, and cold rolled coils and sales of steel products supplied from regional sources

In May 2011, Metal One obtained a permit to set up a company in Vietnam and founded Metal One (Vietnam) Co., Ltd. (MOV). The new company was originally a liaison office in Vietnam that was upgraded so that it could become a party to purchase and sale contracts. Headquartered in Ho Chi Minh City, MOV has a branch in Hanoi and a business office in Vung Tau.

Vietnam has become a market-oriented internationalized economy thanks to its doi moi (renewal) policy. After its admission to the World Trade Organization in 2007, the country continued to attract investments from abroad, promote industrialization, and invest in social overhead capital.

Against this general economic background, the apparent steel consumption (domestic output + imports – exports) in Vietnam last year stood at approximately 11 million tonnes, staying well above the landmark of 10 million tonnes. This sustained high level suggests a continued high growth of steel demand.

The consumption of structural steel in the construction and civil engineering sectors in particular reached about 6.3 million tonnes, up 16% from that the year before, reflecting strong demand. The funneling of foreign funds and official development assistance into the development of infrastructure in and after 2011 is expected to continue. Such infrastructure includes electric power, highways, and ports and harbors. Armed with its newly incorporated subsidiary in Vietnam, the Metal One Group will mobilize all of its potential, endeavor to unceasingly renovate and optimize functions and business models, and create a one-stop solution that answers the diverse needs of the construction and civil engineering markets.

President Naoto Matsuoka Visits Brazil	From Value One Autumu 2011 No. 34

Gains Firsthand Knowledge of Realities in Brazil and Hears Frank Opinions

Views being exchanged at the party (Second from right, President Matsuoka)

President & CEO Naoto Matsuoka visited Brazil from August 8 through 10. In addition to attending the South America block conference at Metal One do Brasil Comércio, Importação, Exportação e Rep. Com. Prods. Sid. Ltda., he visited Soluções em Aço Usiminas S.A. (Solutions Usiminas), a service center in which Metal One is a partner with a 20% equity stake. He met Mr. Mario Port, president of Solutions Usiminas, and actively exchanged views on how to attract steel demand in Brazil, which is expected to increase even more, and further improve the steel distribution service.

At the South America block conference, which began with an overall review of performance records in fiscal 2010 and a reconfirmation of management themes for fiscal 2011, the participants discussed, among other topics, the actual situation of the Brazilian economy that is behind the nation's steady growth and strategies that focus on the South American market at large as well as on individual regions.

Every year, Metal One holds two to four conferences in each of the six overseas blocks, including South America. The conference serves as a forum in which chief regional officers, general managers of overseas offices, and representatives of business investment affiliates gather to mainly confirm the directionality of business development in other countries and to share and solve issues common to different regions.

President Matsuoka actively attends these block conferences. He considers it very important to directly explain the management policy to each block where the relative weight of market-oriented business models is increasing and to gain firsthand knowledge of the realities of each block by visiting the area.

During his recent visit to Brazil, he told those who attended an informal party following the conference, "The key to promoting domestic sales in any country is the staff's ability to express and make known useful information and opinions. I am looking forward to receiving active proposals." He was listening directly to personnel transferred from Metal One and national staff.

(Global Strategy & Coordination Department)