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| August 31, 1998 |
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| Enhancement of CD-R Business |
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| Mitsubishi Chemical Corporation |
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Mitsubishi Chemical Corporation (Head Office: Chiyodaku, Tokyo, Japan, President:
Akira Miura) decided to increase the supply capacity of CD-R (recordable compact
disk) from current 6 million pieces per month to 11 million.
CD-R is a recordable compact disk which can write only once and the world annual
consumption jumped to 500 to 600 million pieces this year from 180 million last
year. The estimate of consumption in 1999 is 800 to 1,000 million and further
sharp increase is expected in the next several years. Mitsubishi Chemical is now
manufacturing 6 million pieces per month of CD-R both in Mitsubishi Chemical Infonics
of Singapore (4.2 million pieces per month) and in Mitsubishi Chemical Infonics
Ireland (1.8 million pieces per month). Mitsubishi Chemical investigated how to
respond to the marvelous growth of worldwide demand including the addition of
new manufacturing lines. As a result, It is decided to consign the toll manufacturing
of 5 million pieces per month to CMC Magnetic Corporation of Taiwan (Head Office:
Taipei, Taiwan, President: Bob M. S. Wong) for the expansion of supply capacity.
CMC Magnetic Corporation is manufacturing and selling floppy disk (FD), video
tape and CD-R and is world No. 1 manufacturer of FD. With the agreement of consignment,
CMC Magnetic Corporation construct new manufacturing line (of 5 million pieces
per month) exclusively for toll manufacturing for Mitsubishi Chemical and is scheduled
to start the manufacturing in October 1998. Mitsubishi Chemical is going to cooperate
with CMC Magnetic Corporation by supplying the expertise of manufacturing technologies
and experienced personnel, inspecting the products based on the quality standards
of Mitsubishi Chemical to secure the same quality with the own product of Mitsubishi
Chemical.
(The conventional manufacturing line of CMC Magnetic Corporation will be independently
operated of the new exclusive toll manufacturing line by CMC Magnetic Corporation.)
By the toll manufacturing agreement with CMC Magnetic Corporation, Mitsubishi
Chemical establishes the third manufacturing base following Singapore and Ireland
keeping the position of world top CD-R manufacturer of 11 million pieces per month
capacity.
Mitsubishi Chemical has very close relationship with CMC Magnetic Corporation
in the wide range business alliances in the toll manufacturing and the transfer
of manufacturing facilities as a link of the restructuring of Verbatim, a wholly
owned subsidiary of Mitsubishi Chemical America for FD and data tape.
Mitsubishi Chemical determines to operate optical disk business as a core businesses
of the company. In the meantime, CD-R will be sold through Mitsubishi Chemical
Media in Japan and Verbatim in the rest of the world, both of them are wholly
owned subsidiaries of Mitsubishi Chemical Corporation.
| For further information, please contact |
| Information Storage Products Department |
| Mitsubishi Chemical Corporation |
| Tel: [+81] 3-3283-6631 |
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