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| April 14, 1998 |
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| Mitsubishi Chemical To Acquire Hoechst's Interest
in Polyester Film Joint Venture. |
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| Mitsubishi Chemical Corporation |
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Mitsubishi Chemical Corp. (Head office: Chiyoda-ku, Tokyo, Japan; President: Akira
Miura)and Hoechst AG have signed a letter of intent that Mitsubishi Chemical group
companies will acquire the shares currently held by Hoechst in their three polyester
film joint ventures with us. The joint ventures are located in Japan, the U.S.
and Europe.
Mitsubishi Chemical's downstream polyester business has been positioned as one
of the company's core businesses, in addition to its terephthalic acid and ethylene
glycol businesses. These two materials are raw materials for polyester production.
Recognizing the future potential of the polyester film market, and the benefits
to be accrued from vertical integration with its feedstocks, Mitsubishi has been
making some studies for the objective of establishing an even stronger market
position where it could maximize the development of its business. Since the year
before last, Hoechst has been refocusing its business strategies, and shifting
emphasis towards life sciences. Under such circumstances, Mitsubishi entered into
negotiations with Hoechst in the fall of last year to take over the joint venture,
and Hoechst has agreed with Mitsubishi to relinquish its shareholding in the polyester
joint ventures. Mitsubishi will, by ourselves, operate a big business, ranking
Mitsubishi number two group in the world after DuPont, whose total capacity after
the acquisitions are completed will be 170,000 tonnes/yr (at the end of this year).
Mitsubishi will make such a global operation under a uniform strategy.
The three joint venture companies which Mitsubishi will acquire from Hoechst are
Diafoil Hoechst Co. Ltd. in Japan, Hoechst Diafoil GmbH in Germany and Hoechst
Diafoil Company in the USA. Diafoil Hoechst Co. Ltd. in Japan has Bakrie Diafoil,
Indonesian subsidiary.
Polyester film has the superior physical properties such as heat resistance, tensile
strength and dimensional stability. It is of prime importance in areas such as
electrical/OA applications, magnetic tapes/cards and foodstuff packaging, and
numerous new applications have emerged in recent years. Especially Japan is a
main base for development on new applications. More than 5% growth is expected
worldwide.
After negotiations with Hoechst on final agreement, Mitsubishi plans to acquire
the Hoechst shares, and in July change the company name and make a new start.
As part of the Mitsubishi Chemical group, the new operation will strengthen its
ties with other group members, unify product grades, develop new applications,
strive to directly respond to global user needs.
Outline of the joint ventures
A. Diafoil Hoechst Co., Ltd (in Japan)
| Head office: |
Minato-ku, Tokyo |
| Plant: |
Santou-chou, Sakata-gun, Shiga-pref. |
| President: |
Yasuo Harada |
| Ownership of shares: |
Mitsubishi Chemical 66.7%,
Hoechst AG 33.3% |
| Capacity: |
40,000 tonnes/yr |
(Bakrie Diafoil)
| Head office: |
Djakarta, Indonesia |
| President: |
Yoshiaki Shiratsuchi |
| Ownership of shares: |
Diafoil Hoechst 95.4%,
Bakrie Kasei Corp. 4.6% |
| Capacity: |
25,000 tonnes/yr
(at the end of this year) |
B. Hoechst Diafoil GmbH (in Germany)
| Head office: |
Wiesbaden, Germany |
| President: |
Siegmar Bieber |
| Ownership of shares: |
Mitsubishi Chemical 33.3%,
Hoechst AG 66.7% |
| Capacity: |
55,000 tonnes/yr |
C. Hoechst Diafoil Company (Partnership) (in USA)
| Head office: |
Greer, South Carolina |
| President: |
Steven P. Yurich |
| Ownership of partnership interests: |
Diafoil Film, Inc. (100% owned by Mitsubishi Chemical
America) 33.3%,
HNA Holding 66.6% |
| Capacity: |
50,000 tonnes/yr |
| For further information, please contact |
| Public Relations and Investor Relations Dept., |
| Mitsubishi Chemical Corporation |
| Tel: [+81]-(0)3-6414-3730 |
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