NTN: Capital Participation Into Renault's Subsidiary SNR

NTN has executed a definitive agreement dated 24th of July, 2006 (French time) with RENAULT regarding a phased acquisition consisting a capital participation (35%) into SNR Roulements (SNR) which is a wholly owned subsidiary of RENAULT, acquiring total 51% of SNR's shares 1 year after the initial closing, and acquiring total 80% shares within a target period after the 3rd anniversary date until the 5th anniversary date of the closing.



1.Aim of the Capital Participation into SNR

(1) NTN and RENAULT established a joint venture in France in 1998 for manufacturing Constant Velocity Joints (CVJ), automotive power-train parts, and have built up a reliable relationship and cooperative system in the long term. NTN aims to expand this existing solid partnership in CVJ business with RENAULT into bearing business, too.

(2) By acquiring SNR's shares, being No.1 in France with respect to sales and one of the leading bearing manufacturers worldwide, NTN aims to integrate technical strength, production and market development capabilities of both NTN and SNR, to reinforce business structures and improve its presence especially in European market.



· To improve the presence of entire NTN through capitalizing on significant presence which SNR holds in European region

· To expand NTN's business and to improve its competitiveness through capitalizing on SNR's specific areas of technical excellence and innovation including SNR's sensor technology, and on SNR's specific technologies and know-how tailored to geographic region

· To innovate productivity, quality, and technologies, to enhance marketing capabilities, and to improve investment efficiency, through the effective use of the production bases in Europe, Romania, Brazil and other factories, the use of the research and development base, the use of equipment, and personnel exchanges.

· To improve a speed of development through integration and expansion of technologies and know-how held in the overall auto parts businesses, and to achieve a business expansion and establishment of competitiveness, eying the modulisation and unitisation through further reinforcement of the partnership with RENAULT

2.Further plans

Now that NTN executed the definitive agreement on 24th day of July, 2006, we will complete required procedures and aim to come up to the targeted closing date, end of October this year.
· At closing, 35% of SNR's shares will be acquired
· 1 year after closing, 51% of shares will be acquired
· After 3rd anniversary from closing, 80% of shares will be acquired (Plan)

3.Overview of SNR
·Company name: SNR Roulements
·Representative : Mr. Didier Simon
·Location : 1, rue des Usines, 74010 Annecy, France
·Business lines : ·Manufacturing and distribution of bearings and components used in automotive, industrial, aircraft and space equipment
No.1 in France, 7th bearing manufacturers worldwide in sales (estimate)

·Products:
ο ball bearings, tapered roller bearings, precision bearings, clutch release bearings, spherical roller bearings, and cylindrical roller bearings

·History:
ο 1880: Started production of bearings
ο 1916: Established a company manufacturing bearings named SRO (Schmid de Roost Oerlikon)
ο 1946: RENAULT acquired SRO and changed company names to SNR

·Main facilities
ο Manufacturing: France (2 companies, 5 facilities), Brazil (1 company), Romania (1 company), Italy (1 company), etc.

ο Sales: France (1 company, 2 facilities), Germany (1 company, 3 facilities), Spain (1 company), Italy (1 company), Morocco (1 company), Argentina (1 company), USA (1 company), Japan (1 company), etc.

ο SNR has a research and development facility in France (Annecy)

·Headcounts: About 4,000 (SNR Group)

·Main customers: Supplying to mainly auto makers in Europe and Americas in addition to RENAULT, and also to industrial makers

·Sales: 2005 Actual about 78 billion yen
2006 Plan about 85 billion yen

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