LEVERKUSEN, Germany—Covestro A.G. has raised its stake in the Japanese thermoplastic polyurethane joint venture DIC Covestro Polymer Ltd., from 50 percent to 80 percent.
In a Nov. 29 statement, the German polymer company said the move was part of an expansion plan for its TPU business.
The deal also complements Covestro's recent expansions at TPU sites in New Martinsville, W. Va., and Changhua,Taiwan, which increased annual production capacities by 25 percent at each site.
DCP was established in 2000 as a 50/50 joint venture between DIC Corp. and the German partners former parent Bayer AG. The JV manufactures TPU brands such as Pandex, Desmopan and Texin for applications such as automotive, electric appliances, IT, health care and sports.
The total investment is in a "low double-digit million" euro range, Covestro said. The closing date for the acquisition is set for the second quarter 2019, and is subject to regulatory approval.
"The strong and long-term partnership of both companies, as well as our thorough understanding of the future growth potential make this acquisition a fitting step in Covestro's growth strategy," Covestro CEO Markus Steilemann said.
DIC, according to Covestro, will continue to support DCP with its industry network, brand name, and as a local partner.
DCP will continue roduction and research and development at a plant located in DIC's facility in Sakai, Osaka.
Covestro claims to be among the Top 3 TPU suppliers globally.
The company's TPU business is part of the coatings, adhesives, specialties segment and accounted for about 10 percent of the CAS segment sales in 2017.
Having registered a double-digit volume growth for its TPU business, Covestro said it has outgrown the global industry growth rate of 6 percent per year.