Tokyo – Japan’s energy group Eneos Corp. has agreed to acquire JSR's elastomers business, which includes the manufacture and sale of synthetic rubber.
As part of the agreement, signed 11 May, JSR will establish a new company and will transfer the elastomers business and the shares of subsidiaries and affiliates related to this business to the new company.
Eneos is then expected to acquire all the shares of the new company and make it a wholly owned subsidiary on 1 April 2022, the enerhgy group announced 11 May.
The two parties have agreed on an enterprise value of Yen115 billion (€867 million) for the business, which posted an operating loss of Yen11.4 billion, on 20% lower sales of Yen143 billion for the fiscal year ended 31 March.
JSR has been carrying out structural reforms within the elastomers business, including cost reductions such as rationalisation of raw materials and distribution costs.
Eneos said its acquisition is based on the premise that the reforms, expected to cut costs by Yen6 billion, are completed.
JSR's elastomers business contributed about 21% of total group sales in fiscal year 2020 and includes a portfolio of styrene-butadiene rubbers (ESBR and SSBR), polybutadiene rubber, polyisoprene, nitrile rubber, butyl rubber, ethylene-propylene rubber and thermoplastics elastomers.
Eneos said a key reason behind the acquisition was the company’s SSBR materials, which it said are “indispensable to the mobility industry.”
“Eneos expects tires to be needed regardless of changes in [vehicle] power sources and forms, and elastomers business is a field where growth can be expected in the future,” said the Eneos statement.
The acquisition is part of Eneos’ 2040 long-term vision, which sees the group focusing on high-performance materials as a growth area.
“By acquiring technology in new core areas for our materials business, Eneos will be able to provide high-performance materials that support various industries including the mobility industry,” it added.
Formerly JXTG Nippon Oil & Energy Corp., Eneos is based in Tokyo and is a leading Japanese petroleum company.