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Mar. 29, 2012
Sumitomo Corporation

Notice concerning the Strategic Capital Alliance Formed with Sipcam, Italy in Europe

Sumitomo Corporation (Head Office: Chuo-ku, Tokyo; President and CEO: Susumu Kato) hereby announces that on March 26, 2012, Sumi Agro Europe Ltd. (Head Office: London, UK; President Hideo Ozaki; hereinafter "SAE")--Sumitomo Corporation's 100% subsidiary engaged in the sales of agricultural chemicals--and Sipcam S.p.A. (Head Office: Milan, Italy; President: Nadia Gagliardini; hereinafter "Sipcam")--a leading Italian manufacturer and seller of agricultural chemicals--formed a strategic capital alliance by mutually acquiring 10% of the outstanding shares of their newly established holding companies, namely Sumi Agro Limited (Head Office: London, UK; President: Hideo Ozaki; hereinafter "SAL") and Sipcam Europe S.p.A. (Head Office: Milan, Italy; President: Nadia Gagliardini; hereinafter "Sipcam Europe").

SAL supervises the business of its subsidiaries in France, Poland, Hungary, Romania, Czech/Slovakia, Bulgaria and Germany, while Sipcam Europe supervises the business of its subsidiaries in Italy, Spain, Portugal, the U.K., Greece and Benelux countries. Through the capital alliance, SAE and Sipcam will establish common platform to expand their sales across the European agricultural chemicals market and enhance the development, registration and marketing of their agricultural chemicals, fertilizers and seeds across all the major European markets. Also, the provision of comprehensive functions (for development, registration and marketing) mutually made for the respective parties will help both of them expand their product lineups.

The European agricultural chemicals market is sized at 11.5 billion US dollars, which accounts for nearly 30% of the world market. In particular, the Central and East European market and the South European market together are sized at 7.1 billion US dollars, and are therefore important European markets. Regarding the registration of agricultural chemicals in the region, a shift occurred from the traditional registration systems specific for each country to the unified EU 27 registration system.* Accordingly, it is becoming more necessary and important for companies to expand their business to cover the entire EU region. Against this background, SAE and Sipcam aim to expand their business through the capital alliance.

Sumitomo Corporation has been expanding its value chain in the agricultural chemicals business by starting from the export of products made by Japanese manufacturers and subsequently establishing its local importing and distributing corporations and agricultural materials sales companies in 20 or more countries across the world. Through the capital alliance with Sipcam via SAE, the Company plans to improve its distribution network in the European region, which represents the world's largest market for agricultural chemicals, thereby fostering its business expansion and making more contributions to the stable supply of food across the world.

* Shift from traditional registration systems to the unified EU 27 registration system
Traditionally, agricultural chemicals have been registered based on the specific rules of each country. After the launch of the European Union, however, 27 EU member states unified their agricultural chemicals registration system and now, agricultural chemicals companies are not allowed to register or sell their products in the EU unless the use of the active  ingredients contained in the products is approved under the registration system.
 

■Outline of SAL
(1) Company name : Sumi Agro Limited
(2) Location : London, UK
(3) Business details : Holding company supervising its subsidiaries selling agricultural chemicals, seeds and fertilizers
(4) Established : October 2011
(5) Capital : 40 million euros
(6) President : Hideo Ozaki
(7) Sales* : About 83 million euros (plan for 2012)
(8) Investors : SAE (90%) and Sipcam (10%)

* Consolidated sales of six subsidiaries of SAL (Sales of the subsidiary in Germany are not included)
 

■Outline of Sipcam Europe
(1) Company name : Sipcam Europe S.p.A.
(2) Location : Milan, Italy
(3) Business details : Holding company supervising its subsidiaries selling agricultural chemicals, seeds and fertilizers
(4) Established : July 2011
(5) Capital : 36.9 million euro
(6) President : Nadia Gagliardini
(7) Sales : About 110 million euros (for the fiscal year ended Dec. 2011), including affiliate sales
(8) Investors : Sipcam (80%), Nihon Nohyaku Co., Ltd. (10%), SAE (10%)

Inquiries

Corporate Communications Department,
Sumitomo Corporation

TEL:+81-3-5166-3100News Release Contact Form

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