Japanese chemical company Showa Denko (“SDK”) has obtained approval to acquire SGL GE Holding GmbH (SGL GE) effective September 27, 2017.
The approval came from required competition authorities, including Germany and the United States.
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.