Consolidation Marks Launch of JFE Group
On September 27, NKK and Kawasaki Steel will consolidate their entire operations, including subsidiaries and affiliates, under a joint holding company, JFE Holdings, Inc., officially launching the JFE Group. The aim is to create a new business group with a strong earnings base generated mainly from the core businesses of steel and engineering. JFE Holdings will operate as a streamlined group headquarters responsible for strategic planning, risk management, accountability and corporate communications for the JFE Group. To allow flexible administration and prompt business execution, JFE Holdings will have a flat organizational structure comprising four divisions (general and legal affairs, corporate planning, finance and investor relations, and accounting) and an auditors office. The organization will also include two operational groups: the environmental solutions center for environmental and energy-related business planning, and the dimethyl ether (DME) project team. The holding company's workforce will initially number about 70, expanding to around 110 in April 2003. By April 2003, all NKK and Kawasaki Steel operations
under JFE Holdings will be reorganized by business segment into the
following five companies.
JFE Steel
Corporation will adopt a product-based management
system to maximize its responsiveness to customer needs and closely
control profitability of each product in the following business areas:
JFE Steel will consolidate four steelworks belonging to NKK and Kawasaki Steel (Keihin, Chiba, Fukuyama and Mizushima) into two: the East Works and the West Works. In addition, the existing Chita Works will continue to specialize in the production of pipes and tubes. JFE Engineering
Corporation will adopt a consolidated division system
encompassing divisions/centers and functional group companies to flexibly
respond to changes in business environments and maximize profits. The
divisions and centers will include:
JFE Urban Development Corporation will be responsible for developing the large tracts of idle land held by the JFE Group. It will purchase land and build condominiums for outside sales. The company will integrate the real estate development operations of NKK, primarily located in the Tokyo area, with those of Kawasaki Steel, primarily located in the Osaka-Kansai area. Kawasaki Microelectronics Inc. will focus on the application specific integrated circuit (ASIC) business in the rapidly changing LSI market by fortifying its technology base and enhancing customer satisfaction. JFE R&D Corporation will focus on research and development for common basic technologies and development of projects with growth potential to effectively realize the synergy effects of the whole group. JFE Steel and JFE Engineering will each have their own R&D programs to ensure a cohesive link between development, manufacturing and sales. |
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