Kobe Steel turns Indian rubber machinery joint venture into wholly owned subsidiary

TOKYO, April 18, 2019 — Kobe Steel, Ltd. yesterday turned its Indian tire and rubber machinery joint venture, L&T Kobelco Machinery Private Limited (or LTKM), into a wholly owned subsidiary. LTKM manufactures, designs and sells rubber machinery used in making tires for cars and construction equipment. LTKM’s products consist of rubber mixers and twin screw roller head extruders.

Established in 2010, LTKM began as a joint venture 51 percent held by Larsen & Toubro Limited and 49 percent by Kobe Steel. Kobe Steel and its Singapore subsidiary, Kobelco Machinery Asia Pte. Ltd., together now own 100 percent of LTKM. As a result of this change, LTKM will change its name in May to Kobelco Industrial Machinery India Pvt. Ltd. (or KIMI).

Since its establishment, LTKM has been jointly managed with Larsen & Toubro as a strategic partner to develop sales channels and promote product and brand penetration. Demand for tire and rubber machinery has been increasing in recent years owing to the rising production of cars. Emerging markets, including India, have been growing 5 percent or more per year. Amid these circumstances, the two parent companies agreed to turn LTKM into a wholly owned subsidiary of Kobe Steel to enable more flexible management, increase marketing capabilities, and strengthen cost competitiveness from a production perspective.

By turning LTKM into a wholly owned subsidiary, Kobe Steel plans to not only capture further demand in India, but expand sales in Southeast Asia and Europe.

Rubber mixers are at the most upstream position in the manufacturing process of tires and other rubber products. Rubber, carbon, sulfur, chemicals, oil and other ingredients are mixed and kneaded in mixers.

Twin screw roller head extruders are installed downstream of the rubber mixers. Extruders extrude the rubber compound, consisting of the mixed rubber and other raw materials, into sheets.

Company name：

L&T Kobelco Machinery Private Limited

Location：

Kanchipuram, Tamil Nadu, India

Capital：

500 million rupees

Established：

November 2010 (with operations beginning in 2011)

Shareholding ratio：

Larsen & Toubro 51％, Kobe Steel 49％

Representative：

S. Arul

Business：

Manufacture, design, sales and service of tire and rubber machinery

In addition to its Takasago Works in Japan, Kobe Steel has expanded overseas with manufacturing and sales locations in the United States, China, Germany and India. Kobe Steel is one of the top manufacturers of rubber machinery with an estimated 40 percent world market share for rubber mixers.