Japan’s Mitsui Chemicals and SKC Co of South Korea have entered into a 50:50 joint venture agreement to consolidate the polyurethane material businesses of both companies. MCI and SKC target to form the new joint venture company by April, subject to completion of necessary procedures, such as the obtaining of relevant approvals and licenses. The new company, which is yet to be named and will be headquartered in South Korea, will have revenues of approximately US$1.5 billion with targeted sales of US$2 billion per year by 2020.

The joint venture will fully utilise the global networks of MCI and SKC covering Far East Asia, China, ASEAN, Europe, and the Americas based on close relationships with customers and the provision of “quick and efficient technical services.” It will also develop new applications and customers through consolidation of products and technologies of MCI and SKC.

One of the reasons for the joint venture is to offer cost competitiveness by “optimising resources/maximising efficiency and taking advantage of the parent companies’ raw materials.”

Production facilities to be integrated in the new joint venture are TDI plants in Omuta, Japan, (120,000 tonnes/year) and Kashima, Japan, (117,000 tonnes/year, to be shut down in 2016); MDI plants in Omuta, Japan, (60,000 tonnes/year, to be shut down in 2016) and Yeosu, South Korea (200,000 tonnes/year at an existing joint venture: Kumho Mitsui Chemicals); and polyol plants in Ulsan, South Korea (180,000 tonnes/year), and Nagoya, Japan, (50,000 tonnes/year). The new joint venture will also operate system houses in China in Tianjin, Suzhou, Foshan and Beijing, as well as in Thailand, Indonesia, Malaysia, the US, and Poland.

Other plants include the 8,000-tonne/year biomass-based polyol plant that will start up in 2015 at Vithal Caster Polyols in Gujarat, India. This company is a joint venture between Mitsui Chemicals, Japanese castor oil producer Itoh Oil Chemical and Indian castor oil maker Jayant Agro-Organics. It is expected that this joint venture will supply cost competitive bio-polyol, thereby allowing Mitsui Chemicals to target further expansion of its sales in automotive applications through six of its systems houses throughout Asia.