Taiyo Nippon Sanso to become an affiliate of Mitsubishi Chemical Holdings

On May 13, Taiyo Nippon Sanso (TNSC) and Mitsubishi Chemical Holdings (MCHC) announced that agreement had been reached whereby Taiyo Nippon Sanso would become an affiliate of Mitsubishi Chemical Holdings. Mitsubishi Chemical Holdings is aiming at acquiring the majority of the issued stock of Taiyo Nippon Sanso, implementing a Takeover Bid (TOB). The timing of the TOB is set for the beginning of November, after completing the procedures in accordance with the Anti Trust Law. Taiyo Nippon Sanso will maintain as a listed company even after the TOB.

In September of last year, Taiyo Nippon Sanso and Mitsubishi Chemical Holdings concluded a capital and business alliance under which Mitsubishi Chemical Holdings obtained ownership of 27% of the Taiyo Nippon Sanso stock.

These two companies, by expanding the capital and business alliance, are anticipating bringing about more wide ranging synergetic effects. For the medical related area, through their mutual sales channels, Taiyo Nippon Sanso will expand its sales of medical gases and related equipment, while Mitsubishi Chemical Holdings is looking toward expansion of its sales of artificial carbonated springs and carbon fiber composite cylinders. Taiyo Nippon Sanso will utilize its gas production knowhow at the Mitsubishi Chemical Holdings overseas production centers to be planned for setting up abroad. In this way Taiyo Nippon Sanso will be striving to expand its business abroad. Mitsubishi Chemical Holdings too will expand its business through the Taiyo Nippon Sanso on-site business in the US where the shale gas business is booming. It is setting its sights on the possibility of entrance into the shale gas related business.

Mitsubishi Chemical Holdings, as a business conglomerate composed of 4 companies, Mitsubishi Chemical, Mitsubishi Tanabe Pharma, Mitsubishi Plastics, and Mitsubishi Rayon, is engaged in business over a wide range of areas, involving performance products, health care, and industrial materials. It is a major, comprehensive chemical company in Japan capitalized at 50 billion yen, with 56,031 employees on a consolidated basis. This year sales should total around 3.5 trillion yen on a consolidated basis, with an operating profit of 110.5 billion yen on a consolidated basis.

There is a rumor that both Air Products and Airgas in the US had been searching for the possibility of acquiring Taiyo Nippon Sanso.

(Photo: Y. Kobayashi, President and CEO of Mitsubishi Chemical Holdings, and S. Tanabe, President, shaking their hands)

14 May. 2014

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