Tosoh Moving Forward on Merger with Nippon Polyurethane Industry Co., Ltd.

Tokyo, Japan— Tosoh announced on September 30, 2013, that it would examine and prepare for a merger with Tosoh’s wholly owned subsidiary Nippon Polyurethane Industry Co., Ltd. (NPU) Today, Tosoh Corporation’s Board of Directors agreed at a board meeting to move forward on the merger with NPU. As this absorption merger is with a wholly owned, consolidated subsidiary, information related to this merger will be abbreviated.

1) Purpose:
NPU makes and sells polyurethane raw materials, and its isocyanate operations are integral to Tosoh’s fully integrated vinyl chain operations. Tosoh’s Nanyo Complex supplies utilities and the isocyanate raw materials aniline, carbon monoxide, and chlorine to NPU. NPU’s downstream processes generate hydrogen chloride that NPU furnishes to Tosoh as a raw material for vinyl chloride monomer. The merger will unify management and heighten efficiencies in the integrated supply structure between NPU and Tosoh.

Tosoh made NPU a consolidated subsidiary in April 2006 and upped its stake in NPU to 80.28% in May 2008. In July 2012 NPU became a wholly owned subsidiary in order to further integrate NPU’s operations with its own and to thereby establish a more efficient management structure for NPU.

Tosoh expects increasingly severe competition in the isocyanate business and the merger will bring a strong management platform to face the changing challenges of the industry. It will also lead to faster decision making, a unified manufacturing system and more efficient management brought by optimization of R&D activities.

2) Outline
a.) Merger Process

Board of Directors approve merger agreement


Conclude merger agreement


General Shareholders Meeting: approval of merger agreement


Merger goes into effect


Note: According to Japan’s corporate law article 784, paragraph 1, approval for the merger is not required of the NPU Board because NPU is a 100% wholly owned subsidiary of Tosoh Corporation.

b.) Merger Method
In the absorption-type merger, Tosoh Corporation will remain and NPU will be dissolved as a legal entity.

c.) Allotment and issue of shares
Because NPU is a 100% wholly owned subsidiary, new shares will not be issued as a result of the merger.

d.) Stock acquisition rights and bonds with stock acquisition rights
NPU will not issue stock acquisition rights and bonds with stock acquisition rights.

3) Following is a summary of the merging entities, Tosoh Corporation and Nippon Polyurethane Industry Co., Ltd., as of March 31, 2014:

Company Name
Tosoh Corporation (will be surviving entity)
Nippon Polyurethane Industry Co., Ltd. (will be dissolved)
Business Summary
Manufacture, fabrication, and sale of inorganic and organic chemicals and activities related to those operations. Manufacture, fabrication, and sale of polyurethane raw materials and activities related to those operations.
Date of establishment
February 2, 1935
March 4, 1960
Main office address
4560 Kaiseicho, Shunan-shi, Yamaguchi prefecture, Japan
4-1-23 Shiba, Minato-ku, Tokyo, Japan
Representative director
President and Representative Director Kenichi Udagawa
Osamu Hamada
¥40.6 billion
¥11.5 billion
Issued shares
Accounting period
April 1 - March 31
April 1 - March 31
Principal shareholders and equity percentages
Japan Trustee Services Bank, Ltd., 6.58%; The Master Trust Bank of Japan, Ltd., 5.59%; Mizuho Corporate Bank, Ltd., 3.66%
Tosoh Corporation 100%
Financial Position and Results

March 31, 2014 (Consolidated) (¥ Billions, except figures indicated by an asterisk are face value)
March 31, 2014 (Nonconsolidated)
(¥ Billions, except figures indicated by an asterisk are face value)
Total assets
Net assets
minus ¥55.1
Net assets per share (¥)
minus ¥15,308.74*
Net sales
Operating income
Ordinary income
Net income
Net income per share (¥)

4) Changes after the merger
Trade names, locations, representative directors, business, capital, and fiscal accounting periods will not change.

5) Projections
The effect of the merger on Tosoh Corporation includes a decline in Tosoh’s tax expenses. Projections of the amount of the decline are based on Tosoh’s booking of deferred tax assets related to the temporary differences arising from Tosoh’s assumption of NPU losses carried forward, etc. On a nonconsolidated basis, extraordinary income is projected for the accounting period when the merger takes place. The earnings release issued on May 9, 2014, presents projections for the fiscal period ending March 31, 2015, that reflect the estimated financial impact of the merger on Tosoh.



It is the parent of the Tosoh Group, which comprises 130 companies worldwide and a multiethnic workforce of over 11,000 people and generated net sales of ¥772.3 billion (US$7.7 billion at the year-end rate of ¥100.17 to the US dollar) in fiscal 2014, ended March 31, 2014.


Tosoh is one of the largest chlor-alkali manufacturers in Asia. The company supplies the plastic resins and an array of the basic chemicals that support modern life. Tosoh’s petrochemical operations supply ethylene, polyethylene, and functional polymers, while its advanced materials business serves the global semiconductor, display, and solar industries. Tosoh has also pioneered sophisticated bioscience systems that are used for the monitoring of life-threatening diseases. In addition, Tosoh demonstrates its commitment to a sustainable future in part by manufacturing a variety of eco-products.

Stock Exchange Ticker Symbol: 4042


This document may contain forward-looking statements, including, without limitation, statements concerning product development, objectives, goals, and commercial introductions, which involve certain risks and uncertainties. The forward-looking statements are also identified through the use of the word anticipates and other words of similar meaning. Actual results may differ significantly from the expectations contained in the forward-looking statements.

For more information, please contact


Gina Lau
International Public Relations
Tosoh Corporation

[email protected]
Tel: +81 3 5427 5118
Fax: +81 3 5427 5198