CHANGSHU, China, June 5, 2013 /PRNewswire-FirstCall/ -- Sutor Technology Group Limited (the "Company" or "Sutor") (Nasdaq: SUTR), a leading China-based manufacturer and distributor of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications, today announced Ningbo Zhehua Heavy Steel Pipe Manufacturing Co., Ltd. ("Ningbo Zhehua"), a subsidiary of Sutor, had entered into a partnership agreement with Zhejiang Longkey Anti-corrosion Co., Ltd. ("Zhejiang Longkey") to build an anti-corrosion coating line at Ningbo Zhehua's operating base in Ningbo, Zhejiang province.
According to the agreement, Zhejiang Longkey will be responsible for procurement, construction, operating, and maintenance of the coating line and Ningbo Zhehua will provide land and factory buildings. The production facilities will be housed in the existing buildings inside the fence of its factory. As a result, capital expenditures for Ningbo Zhehua will be minimal. The new coating line will be 100% owned by Zhejiang Longkey and is expected to start operations in the first quarter of fiscal 2014.
Through this agreement, Ningbo Zhehua will have the ability to bid on additional pipe manufacturing contracts that require special anti-corrosion processing: these are bids that Ningbo Zhehua has been unable to bid for in the past. Further, Zhejiang Longkey will refer customers to Ningbo Zhehua. Once the bids are awarded, Ningbo Zhehua will manufacture the pipes and complete the anti-corrosion process by using the line operated and maintained by Zhejiang Longkey's personnel. Zhejiang Longkey will charge an anti-corrosion fee which will be included in the selling prices of the pipes.
Mr. Yueming Shi, president of Zhejiang Longkey, said, "We are pleased to partner with Ningbo Zhehua. Its diversified product portfolio, large market share in Eastern China, and extensive expertise in the heavy steel pipe manufacturing sector are very appealing to our existing business and we look forward to exploring more opportunities in the near future."
Ms. Lifang Chen, Chairwoman and CEO of Sutor, commented, "Sutor is delighted to cooperate with Zhejiang Longkey, a leading company in the anti-corrosion field with Class-1 Qualification for Anti-corrosion Construction. Zhejiang Longkey specializes in anti-corrosion technologies and provides solutions for a variety of construction projects and industrial applications. Its technical expertise and commitment to quality are complementary to our products and services."
"Anti-corrosion is an important value-added process in the steel pipe manufacturing business. The partnership demonstrates our continuous efforts to improve the value of finished products and gain access to more sophisticated customers. Given the fact that Ningbo Zhehua has completed approximately 15,000 metric tons of supply contracts by using Zhejiang Longkey's anti-corrosion service in the past several months, we are encouraged by this joint operation," Ms. Chen concluded.
About Sutor Technology Group Limited
Sutor is one of the leading China-based manufacturers and distributors of high-end fine finished steel products and welded steel pipes used by a variety of downstream applications. The Company utilizes a variety of in-house developed processes and technologies to convert steel manufactured by third parties into fine finished steel products, including hot-dip galvanized steel, pre-painted galvanized steel, acid-pickled steel, cold-rolled steel and welded steel pipe products. To learn more about the Company, please visit http://www.sutorcn.com/en/index.php.
This press release includes certain statements that are not descriptions of historical facts, but are forward-looking statements. Such statements include, among others, those concerning our expected financial performance, liquidity and strategic and operational plans, our future operating results, our expectations regarding the market for our products, our expectations regarding the steel market, as well as all assumptions, expectations, predictions, intentions or beliefs about future events. You are cautioned that any such forward-looking statements are not guarantees of future performance and that a number of risks and uncertainties could cause our actual results to differ materially from those anticipated, expressed or implied in the forward-looking statements. These risks and uncertainties include, but not limited to, the factors mentioned in the "Risk Factors" section of our Annual Report on Form 10-K for the year ended June 30, 2012, and other risks mentioned in our other reports filed with the Securities Exchange Commission ("SEC"). Copies of filings made with the SEC are available through the SEC's electronic data gathering analysis retrieval system (EDGAR) at http://www.sec.gov. The words "believe," "expect," "anticipate," "project," "targets," "optimistic," "intend," "aim," "will" or similar expressions are intended to identify forward-looking statements. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. The Company assumes no obligation and does not intend to update any forward-looking statements, except as required by law.
For more information, please contact:
Jason Wang, Director of IR
Lena Cati, IR Representative
Sutor Technology Group Limited
The Equity Group
Tel: 212 836-9611
SOURCE Sutor Technology Group Limited