Yokohama creates company to oversee Chinese activities

Tokyo -- The Yokohama Rubber Co., Ltd., will establish Yokohama Rubber (China) Co., Ltd., in the city of Shanghai, China, to exercise overall control of business operations at each of its companies in China. Yokohama Rubber (China) will be capitalized at $30 million and will be in operation from December 2005.

Yokohama Rubber is involved in China through three production and sales companies: Hangzhou Yokohama Tire Co., Ltd. (established in December 2001), producing and selling tyres for passenger cars; Yokohama HAMATITE (Hangzhou) Co., Ltd. (established in February 2004), producing and selling sealant for passenger cars; and Yokohama Hoses & Coupling (Hangzhou) Co., Ltd. (established in December 2004), assembling and selling high-pressure hoses. Additionally, as part of its further business expansion in China, Yokohama Rubber intends to establish a joint venture company to produce and sell conveyor belts in January 2006, and another joint venture company to sell tyres in April 2006. (See related stories, below).

In a statement, YRC said, " the company now finds it necessary to manage its businesses with a holding company, which will oversee the entire business in China in the tyre and multiple-business (MB) markets. By establishing a holding company, Yokohama Rubber expects to improve efficiency by integrating duplicate businesses among its companies and strengthening their functions, including sales promotion and marketing efforts."

The holding company will start by financing the new conveyor-belt and tyre joint ventures. Thereafter, it will invest in companies as they are established by Yokohama Rubber in China. Sometime in the future, the three existing companies (mentioned above) will also be placed under the umbrella of the holding company.