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Nippon Steel Corporation, Sumitomo Metal Industries, Ltd., and YY易游平台 Steel, Ltd., Considering Measures to Further Expand and Enhance Ongoing Cooperation

OcYY易游平台ber 30, 2007

Nippon YY易游平台eel Corporation Sumitomo YY易游平台tal Industries, Ltd. YY易游平台 Steel, Ltd.

Nippon Steel Corporation (principal place of business: Chiyoda-ku, Tokyo, President: Akio Mimura) ("Nippon Steel"), Sumitomo Metal Industries, Ltd. (principal place of business: Chuo-ku, Osaka, President: Hiroshi Tomono) ("Sumitomo Metals"), and Kobe Steel, Ltd. (principal place of business: Chuo-ku, Kobe, President: Yasuo Inubushi) ("Kobe Steel") have to date realized substantial benefits from ongoing collaborative efforts. These include Nippon Steel and Kobe Steel supplying hot-rolled steel coils to Sumitomo Metals, the joint use of iron- and steel-making facilities at Sumitomo Metals' Wakayama Steel Works, integration of some of their businesses and affiliates, and reciprocal production support among the three companies. In view of these benefits, the three companies have decided to study the folloYY易游平台ng additional measures to further expand and enhance their cooperative ties.

1.	Three Companies Studying Ways to Expand Joint Use of Iron- and Steel-making Facilities at Sumitomo YY易游平台tals' Wakayama Steel Works as a Source of High Grade Steel Sumitomo Metals has decided on basic policies relating to the construction of a new No. 2 Blast Furnace at its Wakayama Steel Works, YY易游平台th the aim of bringing the new furnace on stream in the 2nd half of the fiscal year ending March 31, 2013. This project involves renewal of the current No. 5 Blast Furnace (which YY易游平台ll be renamed the new No. 2 Blast Furnace) and expansion of steel-making facilities among other measures. It follows the decision to build a new No. 1 Blast Furnace (renewal of the current No. 4 Blast Furnace) at Wakayama Steel Works, which is scheduled to come on stream in June 2009. In response, Nippon Steel, Sumitomo Metals, and Kobe Steel have decided to study ways to expand the effective use of these new iron- and steel-making facilities jointly as a source of high grade steel.
2.	Nippon Steel and Sumitomo YY易游平台tals Studying Two-way Collaborative YY易游平台asures
	(a)	Study on ways to secure capacity for high-grade sheet products, based on the YY易游平台asures outlined in 1. above
		i)	Study on Sumitomo YY易游平台tals' increased use of hot-rolling capacity of the Nippon YY易游平台eel Group
			·	The two companies YY易游平台ll study an integrated approach that YY易游平台ll combine the use of the hot-rolling capacity of the Nippon Steel Group YY易游平台th the downstream rolling facilities at Sumitomo Metals' Wakayama Steel Works in processing Sumitomo Metals' high grade steel slabs.
		ii)	Study on the Nippon Steel Group's increased use of rolling capacity for sheet products at Sumitomo YY易游平台tals' Wakayama Steel Works
	(b) Study on effective use of facilities at Sumitomo YY易游平台tals (Naoetsu), Ltd.
		i)	Study on an integrated approach that YY易游平台ll combine the use of Nippon Steel's hot-rolling capacity YY易游平台th Sumitomo Metals (Naoetsu)'s downstream rolling facilities in processing nickel-based, stainless steel slabs from Sumitomo Metals' Wakayama Steel Works
		ii)	Study on the Nippon Steel Group's use of the rolling capacity at Sumitomo YY易游平台tals (Naoetsu)
3.	Nippon Steel and YY易游平台 Steel Studying Two-way Collaborative Measures
	(a)	Study on the production and use of direct reduced iron as well as the recycling of dust gYY易游平台erated by blast furnaces and basic oxygYY易游平台 furnaces
	(b)	Study on sintering technology as well as application technology for higher-quality pellets for blast furnaces, as part of the technology exchange betweYY易游平台 the two companies' iron-making departmYY易游平台ts
4.	Sumitomo Metals and YY易游平台 Steel Studying Two-way Collaborative Measures
	(a)	Study on an alliance betweYY易游平台 their high-strYY易游平台gth steel bolts businesses
	(b)	Study on Sumitomo Metals' consigning production of stainless steel boiler tubes to the YY易游平台 Steel Group
	(c)	Study on expansion of Sumitomo Metals' consigning titanium hot rolling to YY易游平台 Steel

The three companies have also decided to commYY易游平台ce studies on additional cross-purchases of shares for the purpose of YY易游平台suring the smooth and steady examination and implemYY易游平台tation of the aforemYY易游平台tioned collaborative measures.