SDK Obtains Competition Authorities' Approval for SGL GE Acquisition and Decides to Transfer U.S. Business to Tokai Carbon
28 Settembre 2017 - 02:00AM
JCN Newswire (English)
Showa Denko ("SDK"; TSE:4004) has obtained approval from all
required competition authorities, including Germany and the United
States, for its acquisition of SGL GE Holding GmbH (SGL GE)
effective September 27, 2017 (US time). The transaction was
announced earlier in our news release of October 20, 2016 entitled
"Acquisition of the Graphite Electrode Business of SGL Carbon
SE."
The U.S. competition authorities approved the acquisition on
condition that SGL GE's graphite electrode business in the U.S. is
sold, and SDK decided at its board meeting today to transfer that
business to Tokai Carbon Co., Ltd. (Tokai Carbon), which the U.S.
competition authorities have approved as the purchaser, after the
closing.
SDK expects to acquire all shares in SGL GE on October 2, 2017.
Soon after the acquisition, SDK will conclude an agreement with
Tokai Carbon concerning the transfer of SGL GE's U.S. business. The
business transfer will be completed in early November 2017.
By making SGL GE a subsidiary, SDK will obtain graphite electrode
production bases in Europe and Southeast Asia, in addition to the
existing bases in Japan, USA and China. As a result, SDK will
become the leading supplier of graphite electrodes and will aim to
further strengthen and expand the business. Showa Denko Carbon,
Inc., SDK's subsidiary in the U.S., expects to increase the
operating rate of its new facilities and reduce costs. SDK will
also aim to quickly achieve the effect of global-scale integration
of SGL GE with existing operations, thereby strengthening cost
competitiveness. Thus, SDK will work to increase durability of the
business and pursue further growth under the fiercely competitive
business environment.
SDK will separately announce the final price for the SGL GE
acquisition and the influence of the acquisition on SDK's fiscal
2017 performance as soon as the details are finalized.
1. Outline of business transfer
(1) Business to be transferred
Name: SGL GE Carbon Holding LLC
Location: 160, Greentree Drive Suite 101, Dover, DE, USA
Representative: Scott L. Carlton, President
Business: Production, sale, and R&D of graphite electrodes in
the U.S.
Capital stock: $100
Establishment: February 3, 2016
Sales (2016): $80.8 million
Production capacity: 30,000 t/year [Hickman (early part of the
process) and Ozark (latter part of the process) combined]
(Accounting for 20% of SGL GE's total capacity of 150,000
t/year)
Employees: Approx. 140
Note: The above sales amount is based on a simple addition of
indexes for SGL GE Carbon Holding LLC and its affiliates.
(2) Transfer method, enterprise value, and price
After SDK's acquisition of all SGL GE shares, SDK will transfer all
shares in SGL GE Carbon Holding LLC (SGL GE's subsidiary for
running its business in the U.S.) to Tokai Carbon. The enterprise
value of the U.S. business is estimated at 16.5 billion yen and the
share transfer price will be 12.9 billion yen (based on the
exchange rate of 110 yen to the dollar).
Note: The price may change depending on the amount of actual
assets, etc. at the time of share transfer.
2. Schedules
Sept. 28, 2017 Decision of SDK's board of directors
Oct. 2, 2017 SDK expects to acquire all shares in SGL GE.
Oct. 2, 2017 SDK and Tokai Carbon expect to conclude an agreement
concerning the transfer of SGL GE Carbon Holding LLC shares.
Early Nov. 2017 All SGL GE Carbon Holding LLC shares will be
transferred to Tokai Carbon.
3. Outline of the buyer
Name: Tokai Carbon Co., Ltd.
Location: 2-3, Kita-Aoyama 1-chome, Minato-ku, Tokyo
Representative: Hajime Nagasaka, President and CEO
Business: Production and sale of carbon black, graphite electrode,
fine carbon, friction materials, and industrial furnace &
related products
Capital stock: 20,436 million yen
Establishment: April 1918
Total assets (consolidated) (as of June 30, 2017): 158,903 million
yen
Net assets (consolidated) (as of June 30, 2017): 118,561 million
yen
Major shareholders and shareholding ratio (As of June 30,
2017):
- The Master Trust Bank of Japan, Ltd. (Trust Account) 10.57%
- Japan Trustee Services Bank, Ltd. (Trust Account) 7.03%
- The Bank of Tokyo-Mitsubishi UFJ, Ltd. 3.53%
- Mitsubishi Corp. 3.00%
- Mitsubishi UFJ Trust and Banking Corporation (Standing proxy: The
Master Trust Bank of Japan, Ltd.) 2.79%
- The Master Trust Bank of Japan, Ltd. (Mitsubishi Chemical Corp.
Retirement Benefit Trust Account) 2.62%
- DFA INTL SMALL CAP VALUE PORTFOLIO (Standing proxy: Citibank,
N.A., Tokyo Branch) 2.13%
- Deutsche Bank AG, Frankfurt (Standing proxy: Mizuho Bank, Ltd.,
Settlement & Clearing Services Department) 2.00%
- Japan Trustee Services Bank, Ltd. (Trust Account 9) 1.80%
- Tokio Marine & Nichido Fire Insurance Co., Ltd. 1.61%
[Reference]
Outline of SGL GE
Name: SGL GE Holding GmbH
Location: Werner-von-Siemens-Str. 18, 86405 Meitingen, Germany
Representative: Klaus Unterharnscheidt, Managing Director
Business: Production, sale, and R&D of graphite electrodes
Establishment: December 11, 2015
Production bases: Six plants [in Germany, Austria, Spain, USA (two
sites), and Malaysia]
Employees: Approx. 900
Press release (PDF):
www.sdk.co.jp/assets/files/english/news/2017/20170928_sdknewsrelease_e.pdf
About Showa Denko K.K.
Showa Denko K.K. ("SDK"; TSE:4004, US:SHWDF) is a major
manufacturer and marketer of chemical products serving a wide range
of fields ranging from heavy industry to the electronic and
computer industries. The Petrochemicals Sector provides cracker
products such as ethylene and propylene, the Chemicals Sector
provides industrial and high-performance gases and chemicals and
high-purity gases and chemicals for the semiconductor industry, and
the Inorganics Sector provides ceramics products such as alumina,
abrasive, refractory and graphite electrodes and fine carbon
products. Today, the Aluminum Sector provides aluminum materials
and high-value-added fabricated aluminum, the Electronics Sector
provides HD media, compound semiconductors such as ultra
high-bright LEDs and rare earth magnetic alloys, and the Advanced
Battery Materials Department (ABM) provides lithium-ion battery
components. For more information, please visit
www.sdk.co.jp/english/.
Source: Showa Denko K.K.
Contact:
Public Relations Office
Phone: 81-3-5470-3235
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