The Board of Directors of Mahindra Ugine Steel Company Limited (MUSCO) have announced the financial closure of the 51:49 Joint Venture with Sanyo Special Steel Co. Ltd. and Mitsui & Co. Ltd. The new Joint Venture company will be called Mahindra Sanyo Special Steel Private Limited. USCO had approved the slump sale of its steel business into its 100% owned subsidiary, Navyug Special Steel Private Limited (Navyug Steel) in November 2011. Following the board meeting of Navyug Steel, the allotment of shares has been completed against cash infusion by Sanyo of approximately Rs. 129 crore for their stake of 29%, while Mitsui paid approximately Rs. 89 crore for their 20% stake in Navyug Steel (JV Co). MUSCO holds the balance 51% of equity in the JV. With financial, technical and operational inputs from Sanyo Special Steel Co. Ltd. and Mitsui & Co. Ltd., the JV expects to enhance both its current production from the existing level of 120,000 tons per annum, the value it adds to the steel and therefore the special applications which the JV can now address. Said Anand Mahindra, Chairman & Managing Director, Mahindra Group, "The Mahindra Group welcomes this JV which will create a strong value proposition and enable MUSCO to leverage Sanyo's technical expertise and Mitsui's international footprint. This new venture will help the company to emerge as one of the most profitable, high quality speciality steel producers in the coming years". "Sanyo is looking forward to working with Mahindra & Mahindra, Mitsui & Co., and all the people of India to make this project a successful one. We consider the future of the special steel market in India to be bright and are happy to be given a chance to make our contribution toward the project. We would try our best to make Mahindra Sanyo Special Steel a successful entity by unlocking the value of this company and making it the best in India with respect to quality, productivity and customer satisfaction" expressed Y. Takeda, President and Representative Director, Sanyo Special Steel Co. Ltd.

A dedicated team has been drawn from Sanyo to lead the manufacturing function and is supported by Mitsui which will contribute its marketing skills and Musco which will provide the general management skills to support the growth of the new JV. MUSCO, Sanyo and Mitsui will collectively utilize their brands, technologies and networks to meet customers' needs through this joint venture. The joint venture is expected to deliver its goal of operational excellence, improved productivity and enhancement of both cost and quality to international standards to enable it to achieve its full business potential. Sanyo's technical assistance will enable the JV to strengthen and differentiate its product portfolio with the introduction of new products for niche and emerging market segments in India like the oil & gas, power, engineering industries among others. This is expected to further strengthen the profitability position of the company. Mitsui will assist the JV in strengthening its sales and marketing footprints in the aforesaid niche and emerging segments as well as the existing alloy steel market in India and will help the JV to access global customers. Through this JV, Sanyo expects to strengthen its global growth expectations by having a share of the growing special steel demand in India through the joint venture. For Mitsui, this transaction is expected to strengthen its ties with the Mahindra Group which is one of Mitsui's important business partners in India. Mahindra is one of the biggest business groups in India, with diversified operations across many business sectors like automobiles, tractors, IT, auto components, real estate, hospitality, non banking finance etc. Mitsui expects further opportunity for collaboration with the group across various business sectors where it is present.

Caption: (L to R) Anand Mahindra, Chairman Mahindra Group, Bharat Doshi, Executive Director & Group CFO, Hemant Luthra - Chairman, Mahindra Sanyo Special Steels Limited, Keshub Mahindra, Chairman Emeritus, Mahindra Group, Y. Tsukamoto, Senior Managing Director, Member of the board Sanyo Special Steel Co. Ltd. and H. Furuhata, General Manager, Investment and Planning, Mitsui and Co. Ltd., Guruprasad Iyengar and Uday Gupta, Managing Director, MUSCO Khopoli at the JV agreement signing.