MITSUI CHEMICALS / SKC: JV for PU raw materials to be dissolved / Disagreement over future -- K Trade Fair

13/10/2021

Plastics News by Plasteurope.com

MITSUI CHEMICALS / SKC: JV for PU raw materials to be dissolved / Disagreement over future

Mistui CEO Tsutomu Tannowa (r.) and SKC CEO Jang Suk Park sealing the now dissolved deal in 2015 (Photo: Misui)
Mitsui Chemicals (Tokyo / Japan; www.mitsuichemicals.com) and SKC (Seoul / South Korea; www.skc.kr) said they will terminate their polyurethane raw materials joint venture because they could not agree on a business strategy for the next steps for the company.

Having formed Mitsui Chemicals & SKC Polyurethanes (MCNS, Seoul; www.mcnskc.com) in 2015 (see Plasteurope.com of 06.01.2015 and 06.07.2015), the two firms have now announced plans to dissolve it by the end of 2021. According to PIEs Polyglobe database (www.polyglobe.net), MCNS TDI capacity is 120,000 t/y.

Prior to the JV, both companies were unable to fully integrate the PU value chain: SKC had exposures in polyol and propylene oxide, but no isocynate (TDI, MDI) capacity. Mitsui Chemicals had polyol and isocynate, but no PO.

The separate statements issued by the companies indicated they are apparently parting ways amicably, saying they will maintain close cooperation and that customers will continue to receive a stable supply of products from either of them.
Separate statements, separate ways
The divergence in strategy rests in Mitsui Chemicals preference for steadily improving earnings through high-performance products, particularly bio-products. SKC is seeking to become a global player and boosting market share worldwide a path MCSN has actually taken over the years as it had set up 12 system houses (manufacturing and sales bases) in China, India, Mexico, Poland, Russia and the US.

MCSNs annual output has also grown during the joint venture from to 110,000 t from 60,000 t.

SKC said its own PU unit will make inroads into Southeast Asia, Latin America and the Middle East and strengthen its eco-friendly material business. The new subsidiary is planning to top KRW 1 tn (EUR 729m) in sales by 2025.

A Mitsui Chemical presentation for analysts dated November 2020 said the company planned to reform its Basic Materials division, which includes the PU activities, before the end of fiscal 2020 on 31 March 2021. It planned to cut costs, downsize assets and expand the downstream businesses by growing niche products


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