UPDATE 1-Konica to build hard drive glass plant in Malaysia http://today.reuters.com/news/articlebusiness.aspx?type=media&storyID=nT329597&imageid=&cap=
Tue Feb 6, 2007
(Updates with confirmation, details)
TOKYO, Feb 7 (Reuters) - Japan's Konica Minolta Holdings Inc. (4902.T: Quote, Profile, Research) said on Wednesday it would invest about 5 billion yen ($42 million) to build a new factory in Malaysia to make glass used in hard disk drives.
Konica, the world's second-largest maker of hard drive glass substrates after Hoya Corp. (7741.T: Quote, Profile, Research), expects strong growth due to the proliferation of consumer electronics equipped with hard drives such as portable music players and notebook PCs.
"The hard drive market is growing about 20 percent annually and we can expect that for materials used in them to grow at a similar rate," said Konica Minolta spokesman Katsuyuki Sakai, confirming an earlier report on the plant in the Nikkei newspaper.
Shares in Konica Minolta failed to get a lift from the news, and were down 1.7 percent at 1,589 yen by early afternoon. The benchmark Nikkei average <.N225> was down 0.93 percent.
Konica Minolta will begin construction of the factory in March and aims to start operations in January 2008. It will be Konica Minolta's first overseas plant for hard drive glass. The company already has two factories in Japan. Konica Minolta will make both 1.8-inch substrates for use in portable music players and 2.5-inch substrates for notebook PCs.
Sakai said the new factory would initially be able to churn out about a million substrates a month, but the company is considering boosting capacity to about three million units in the future depending on demand.
Hoya controls more than half the market for hard drive glass substrates, with Konica Minolta accounting for about 25 percent, Sakai said. The substrates are supplied to hard drive makers such as Seagate Technology (STX.N: Quote, Profile, Research) and Hitachi Ltd. (6501.T: Quote, Profile, Research).
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