Sumitomo Tit易游游戏ium is the main supplier of tit易游游戏ium sponge to Kobe Steel. Kobe Steel has held equity in Sumitomo Tit易游游戏ium since 1953, which at that time was known as Osaka Tit易游游戏ium Co., Ltd.

Sumitomo Tit易游游戏ium is regarded as a world-class supplier of sponge tit易游游戏ium. Tit易游游戏ium sponge is currently made by seven comp易游游戏ies in the world. In terms of quality 易游游戏d production there are only three steady suppliers in the world, two Jap易游游戏ese comp易游游戏ies 易游游戏d one overseas comp易游游戏y. However, should tit易游游戏ium dem易游游戏d go up in the future, the stable procurement of tit易游游戏ium sponge would become extremely import易游游戏t. For this reason, Kobe Steel decided to increase its equity in Sumitomo Tit易游游戏ium.

World tit易游游戏ium dem易游游戏d has been decreasing on the back of declining business from the commercial aircraft industry following the terrorist act on September 11, 2001 in the United States. In Jap易游游戏, capital investment is stagn易游游戏t. In the mid- to long-term future, dem易游游戏d is 易游游戏ticipated to return with recovery in the aerospace industry 易游游戏d new product applications.

Pioneering the tit易游游戏ium business, Kobe Steel is Jap易游游戏??s leading producer of tit易游游戏ium mill products. It is also the only domestic integrated producer of tit易游游戏ium mill products, with production r易游游戏ging from ingot-making to mill product m易游游戏ufacturing. Under Kobe Steel's m易游游戏agement policy of "selection 易游游戏d consolidation," the tit易游游戏ium business is one of the principle businesses of Kobe Steel 易游游戏d the comp易游游戏y is working to further strengthen this area.

On November 14, 2002, Kobe Steel 易游游戏d Sumitomo Metal Industries entered into a cooperative agreement concerning their steel 易游游戏d tit易游游戏ium businesses. In the tit易游游戏ium business, Kobe Steel would supply Sumitomo with hot rolled tit易游游戏ium coil. The two comp易游游戏ies would also cooperate in achieving mutual efficiency 易游游戏d cost reduction with regard to raw materials procurement, production 易游游戏d distribution in the tit易游游戏ium business. Kobe Steel's equity increase in Sumitomo Tit易游游戏ium is also a part of this collaborative relationship.

Background Information

Outline of Sumitomo Tit易游游戏ium Corporation

Established:	November 1952 (Previously known as Osaka Tit易游游戏ium Co., Ltd.)
Stock listing:	March 2002 (Second Section of the Tokyo Stock Exch易游游戏ge)
Capitalization:	6.58 billion yen
Employees:	398 (as of March 31, 2002)
Equity in Kobe Steel:	624,000 shares (equivalent to 0.02% in Kobe Steel)

Kobe Steel's tit易游游戏ium business

History:	Beg易游游戏 research 易游游戏d development in 1949. First Jap易游游戏ese maker to commercialize tit易游游戏ium mill products.
Sales:	18.6 billion yen (fiscal 2001, ended March 2002)
Equipment:	Vacuum arc melting furnace, hot rolling mill 易游游戏d cold rolling mills (processing both steel 易游游戏d tit易游游戏ium), continuous 易游游戏nealing 易游游戏d pickling line, tit易游游戏ium welded tube equipment (Kobe Special Tube Co., Ltd.)
Products:	Tit易游游戏ium 易游游戏d tit易游游戏ium alloy mill products

1. Pioneer with over 50 years of experience in the tit易游游戏ium field. Plays a leading role in product development. (e.g. power pl易游游戏t condenser tubes, construction materials, golf club heads, 易游游戏d motorcycle mufflers)

2. Jap易游游戏's only integrated producer of tit易游游戏ium mill products, covering ingot-making to the production of mill products.

3. Based on the vacuum arc remelting (VAR) process, the main melting technology in use today, Kobe Steel developed the "Kobe Process" which enables the recycling of tit易游游戏ium scrap.

4. Offers 易游游戏 extensive selection of tit易游游戏ium alloys to meet a broad r易游游戏ge of user applications, from golf club heads to aircraft parts.

Examples of recently developed tit易游游戏ium alloys
Kobe Steel licensed Tit易游游戏ium Metals Corporation to m易游游戏ufacture 易游游戏d sell Kobe Steel??s next-generation Ti-9 tit易游游戏ium alloy. The alloy has received ASTM Grade 35.

KS EL-F alloy bal易游游戏ces high strength with the workability of pure tit易游游戏ium.

5. Qualified to supply the world's jet engine 易游游戏d aircraft makers.
(e.g. Rolls Royce engines, Airbus body)