Toray to Expand Textile Production in China

Business Wire, Oct 23, 2001

Business Editors

OSAKA, Japan--(BUSINESS WIRE)--Oct. 23, 2001

Toray Industries, Inc. announced today that it will expand its Chinese-based textile production facility, dubbed Toray Sakai Weaving & Dyeing (Nantong) Co., Ltd. (TSD).

The subsidiary was created in partnership with Sakai Ovex Co., Ltd., a major textile dyeing company in Japan.

Toray will invest a total of eight billion yen (547 million Yuan) to build this new plant, which will produce polyester filament and nylon filament fabrics. Toray is aggressively expanding its filament fabric operations in China based on the country's dynamic economic growth, as well as an expected increase in the demand for high-quality apparel products in U.S. and European markets once China joins the World Trade Organization (WTO).

In addition to the middle-to-heavyweight fabrics products produced by its current plant at a rate of 2.5 million meters per month, the new plant will turn out lightweight high-density fabric mainly for use in sports and casual wear. The new plant is being built in accordance with a mid-term management plan, under which Toray aims to enhance its overseas operations.

Toray will begin building the plant from November 2001. It is expected go online in two phases, with the first occurring in January 2003 and the second following in September 2004. The fully operational plant will produce polyester filament fabric at a rate of 3.0 million meters/month and nylon filament fabric at a rate of 2 million meters/month. Combined with TSD's existing plant, monthly production of polyester and nylon will jump by 5.5 million meters and 2 million meters, respectively.

TSD is located in the city of Nantong near the Hua Dong Apparel Zone, which includes Shanghai, Su Zhou and Ning Bo. The region is primely located for responding quickly to local markets.

The expansion of TSD will create new opportunities for providing leading sports apparel makers in the United States, Europe and China with high-quality products, based on the integration of TFNL (Toray Fibers Nantong Co., Ltd.) and TSD.

Outline of TSD

Capital: 9.6 billion yen (approximately 660 million Yuan)

Shareholders: Toray Industries, Inc. (66.9%)

Sakai Ovex Co., Ltd. (33.1%)

President: Koichi Minorikawa

Production capacity:

- Polyester filament textile weaving

2.2 million meters/month

- Polyester filament textile dyeing

2.5 million meters/month

- Processed yarn

260 tons/month