ZMZ-Bearings

completed

The project is to support Daido Metal Co. Ltd.''s (Daido Metal or the sponsor) entry into Russia through the acquisition of LLC ZMZ-Bearings (ZMZ-Bearings or the company), a leading local manufacturer of half bearings for automotive engines. The company started production of bearings in 1959. It was a 100% owned subsidiary of OAO Severstal-Auto, a Russian Original Equipment Manufacturer (OEM). The company is the largest manufacturer of steel and aluminum strip and plain bearings for automobile engines in Russia and the CIS countries. It manufactures aluminum bearings, half bearings, bushes, washers, and semi-washers for automotive engines. Its major customers are domestic OEMs such as Avtovaz and OAO Zavolzhye Motor Works (ZMZ). The project will introduce the up-to-date technology and high-quality manufacturing standards of a Japanese parts supplier into Russia. Through the acquisition, Daido Metal may have a strong demonstration effect encouraging other Japanese suppliers with advanced technologies to enter into new markets beyond Asia, North America and the EU. The company is located in Zavolzhje town (population is 70,000), about 50 kilometers North-West from Nizhniy Novgorod, in the industrial zone of the territory of ZMZ. All the company’s major facilities, support facilities, storage, administrative and auxiliary facilities are located in a single building. The company leases the building and key equipment from ZMZ. The distance to the nearest residential area is 300 meters and to the nearest water body (the Volga River) is 800 meters. The company is historically connected in its operations to ZMZ. It was established in 1958 and operated as a part of ZMZ until it was spun off as a separate entity in 2003. Its operations as a whole, and the management of environmental and health and safety risks, are interconnected with those of ZMZ– a larger industrial group located in the same industrial area. The main production processes undertaken by the company are:- alloy AMO-1-20 smelting (aluminum – 79%, tin – 20%, copper – 1%) in the induction furnace, decontamination, and continuous casting; - sheathing of the alloy strip with aluminum; - de-greasing of the strip in trichloroethylene steam;- three-layered steel-aluminum strip production; - sliding bearing brass production from the steel-aluminum strip; - mechanical operations with the bearing brass (drilling, slot milling, surface conditioning; and - finished product shipping.