HYOGO, Japan—Toyo Tire & Rubber Co. Ltd. agreed to divest major portions of its chemical industrial products business unit to fellow Japanese companies Nitta Corp. and Sekisui Chemical Co. Ltd. for undisclosed sums.
Among the businesses being divested are components for railway cars, industrial rubber products, hoses, waterproof materials, rigid polyurethane products, etc.
Toyo stressed that the seismic isolation rubber business—which was involved in a series of fraudulent business transactions over the past several years that resulted in tens of millions of dollars in losses for Toyo—is not part of the sale.
Neither Toyo nor Nitta disclosed financial details of the deals, which involve the creation of a new stock companies involving Toyo Chemical & Industrial Products Co. Ltd. and Soflan Wiz Co. Ltd., Toyo subsidiaries.
The Nitta deal involves six factories—three in Japan, two in China and one in Thailand.
Toyo did not disclose the scale of sales the businesses being divested represent.
Toyo said the divestitures are related to a business review process started earlier this year. Toyo said it evaluated and reassessed each business from various perspectives, including market growth potential and business continuity, and determined the best course of action to enhance the value of each business.
That led to Toyo's concluding it would be best for the businesses now targeted for divestment to "pursue future opportunities under the ownership of a well-established company that possesses profound knowledge of a similar business segment, and has the necessary infrastructure to promote the business."