GE, Mitsui Chemicals, Inc. (MCI) and Nagase & Co., Ltd. (Nagase) announced that they have reached the following agreement regarding their two Japanese joint ventures - GE Plastics Japan Ltd. (GEPJ) and GEM PC Ltd. (GEMPC). GE Plastics Japan Ltd.
GE has increased its stake in GEPJ by acquiring the entire equity interests of MCI and Nagase in GEPJ, thereby increasing its equity to 100%. Except for the closing of GEPJ's Chiba Facility located within MCI's Ichihara Works, there will be no change in GEPJ's operations and GEPJ will continue to serve the GE Plastics' Japan customer base as it has in the past.
Nagase will continue to serve the GE Plastics' customers in Greater China and SEA as a sales representative and distributor. GEM PC Ltd.
GE has acquired the entire equity interests of Nagase in GEMPC thereby increasing its equity to 58%. GEMPC will continue to produce Lexan* resins as a joint venture between GE and MCI until March 31, 2008. GEMPC will then cease business operations and will be liquidated. GEPJ will supply Lexan polycarbonate from other GE Plastics' polycarbonate manufacturing facilities located globally.
Toshikazu Tanaka, Executive Vice President of MCI commented, "Considering the longstanding amicable relationship with GE, we seriously considered GE's proposal for the termination of the alliance. We accepted GE's proposal and believed that the arrangement is consistent with MCI's business strategy and will contribute to respective future growth."
Hiroshi Nagase, president of Nagase, commented, "We jointly operated GEPJ with GE since 1971. We would like to express our appreciation for the customers who have given valuable patronage to GEPJ's products for a long time. Although we have agreed to terminate joint ventures in Japan with GE, Nagase will keep the longstanding business relationship with GE Plastics and will continue to serve their customers in Greater China and SEA as a sales representative and distributor. In order to develop and grow our business, we will continue to provide our customers with the goods and services needed."
"We are pleased to reach a mutual agreement with our partners in Japan that creates a win-win situation for all of us. As we look to simplify our global business and fully leverage our leading global polycarbonate asset base, this transaction makes a lot of sense for us," noted Brian Gladden, CEO, GE Plastics. "This move will improve our global cost position for the Lexan business. We have built a great team in Japan with outstanding customer relationships, and this will ensure our strong position in the marketplace."
Takashi Hata, president of GE Plastics Japan, said, "We feel that this move will help us in the important Japan market, and we are committed to make the customer transition activities smooth and efficient."