Sumitomo Corporation is establishing a wind-power generation tower company, under the name of Katana Summit LLC, in the U.S. jointly with T. Bailey Inc. Group, a steel-tank manufacturer in Seattle, thereby engaging in the manufacturing/sales of wind-power generation towers in the U.S. market. Already, Sumitomo Corp. has constructed the first plant of Katana Summit in the State of Washington, putting it into a full-fledged operation in May.

Further, Sumitomo Corp. plans to build the second plant of Katana Summit in Nebraska shortly, intending to build 400 to 600 units of towers annually by 2010. The total amount of related investment is expected to reach about ¥4 billion, and projected yearly sales to major wind-power electric generation equipment manufacturers are planned to total about ¥20 billion in three years from now.

In the United States, demand for reproducible energy, such as wind power, solar power, and biomass, is growing sharply. In particular, wind-power generation, which is in an advantageous position in terms of cost, is attaining a remarkable expansion for the past three years partly helped by Federal and State Governments assistance through tax incentives. Even so, wind-power generation satisfies only 0.5% of total electric power demand in the U.S. at present.

In Europe, the advanced area for wind-power generation, meanwhile, its proportion is substantially higher, as seen in 19% for Denmark, and 5 to 6% in Spain and Germany. Accordingly, Sumitomo Corp. judged that, with the concern about the environmental issues rising further in the U.S., where the wind-power generation ratio is still considerably lower, increased demand for wind-power towers can be expected in the future.

T. Bailey Inc. Group has produced such huge wind-power generation towers with the maximum diameter of 4.5 m and the height of 100 m since 2001. In view of this, Sumitomo Corp. intends to obtain a share of about 15% in the annual construction demand for 3,000 to 3,500 units (expected for 2010) of wind-power generation towers in the U.S. and Canada through business collaboration with the T. Bailey Inc. Group.

Sumitomo Corp. is expecting profits from physical distribution operations consisting of supplying thick steel panels, materials for towers, and procuring a variety of materials to be used for wind-power generation from various parts of the world, in addition to business earnings from Katana Summit, the joint venture.

[Outline of New Joint Concern]

1. Name: Katana Summit LLC. 2. Location: Ephrata, WA and Columbus, NE (planned to commence operation within 2008) 3. Total amount of investment: About \4 billion. 4. Capital contribution ratios: Joint contribution by Sumitomo Corp.  of America and Sumitomo Corp.: 50% T. Bailey Inc.: 50% 5. Time of establishment: May 2007 6. Target production volume: 400 to 600 units per year (2010)