Showa Denko and KH Neochem Co to dissolve their joint venture, Japan Ethyl Acetate Co.

11-Nov-13

Showa Denko and KH Neochem Co., Ltd.have agreed to dissolve their joint venture, Japan Ethyl Acetate Co., Ltd. (JEA). JEA was established in August 2003 for the purpose of strengthening the foundations of the two parent companies' ethyl acetate businesses. JEA, with a production capacity of 100,000 tpa of ethyl acetate, began commercial production in April 2004. 55% stake in the company is held by SDK, while KHNC holds 45% stake.While demand for ethyl acetate has grown inside and outside Japan since then, the business environment has changed dramatically, reflecting the rise in raw material costs and capacity expansions in neighboring countries. Under the circumstances, SDK and KHNC have concluded, after mutual consultation, that it is difficult to continue JEA's operations. Thus, the two companies have agreed to stop ethyl acetate production at JEA, and dissolve the company. Production will be stopped by the end of 2014. After demolition and removal of the production facility, JEA will be dissolved and liquidated without delay.