MHI to Establish Subsidiary in Singapore to Strengthen
Global Operating Structure of Machinery & Steel Structures Business

MIES will undertake a variety of engineering projects, including gas and oil production facilities, flue-gas desulfurization systems and carbon dioxide (CO2) recovery systems, in addition to its primary focus on chemical plant projects. Mitsubishi Heavy Industries Singapore Private Ltd. (MHISP), a wholly owned subsidiary of MHI, will hold 100% of MIES's capital, which will be S$2.4 million (approximately \150 million) upon establishment but is subject to future increases in step with business expansion. MIES will initially launch operations with 11 employees, with plans envisioning an increase to about 50 within four years. Takato Nishizawa, Deputy General Manager of MHI's Machinery & Steel Structures Headquarters, will concurrently serve as Managing Director of MIES.

The markets for environmental and chemical plants are basically in expansionary trends along with economic growth and population increases in the emerging countries. Competition in these markets is intensifying, however, due to the significant ascendancy of Korean companies - with Chinese companies expected to catch up in the future - and rivalry among engineering companies in Japan, Europe and the U.S. To respond to these market conditions, MHI has been faced with the urgent task of maintaining and enhancing its ability to deal promptly, dynamically and locally with customers in areas ranging from project development to construction and completion of plants. It was against this backdrop that MHI opted to establish the new company in Singapore.

In conducting its environmental and chemical plants business overseas, MHIA Environmental Systems, a business unit of Mitsubishi Heavy Industries America, Inc. (MHIA), handles projects in the U.S. MHIA is a wholly owned subsidiary of MHI that oversees the company's U.S. operations. Projects in Europe, Africa, and Russia and neighboring countries are handled by the Amsterdam Branch of Mitsubishi Heavy Industries Europe, Ltd. (MHIE), MHI's subsidiary to oversee its business in Europe. Business in other regions is performed by MHI's Environmental & Chemical Plant Division in Yokohama. The Amsterdam Branch of MHIE was established in July this year.

With the establishment of its new regional business base in Asia, joining bases in the U.S. and Europe, MHI will now turn its attention to further strengthening its business activities in environmental and chemical plants in the fiercely competitive global marketing availing of its enhanced global business structure encompassing its three regional bases plus its operations in Japan.