 2014-02-07 |
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By Wang Kexin, Times Report, Taipei
ACHEM Petrochemical, a subsidiary of YC Group (4306), has entered into a strategic partnership with Toyota Tsusho Corporation (hereinafter referred to as Toyota Tsusho). Under the agreement, Toyota Tsusho has acquired a 20% stake in ACHEM Petrochemical at a 20% premium, amounting to USD 11.76 million, becoming a strategic partner. The formal signing of the agreement was completed recently, and the two companies will jointly target the Chinese and Japanese markets to expand their upstream acrylic acid business.
Acrylic acid, a key raw material for adhesives, will see significant benefits for ACHEM’s tape business (1715) once ACHEM Petrochemical begins mass production. The group annually needs over 40,000 tons of butyl acrylate, and as business expands, the demand increases year by year. With ACHEM Petrochemical’s planned annual production capacity of 80,000 tons of acrylic acid, future raw material supply will be secured. The vertical integration will help ACHEM’s tape production by reducing costs and improving overall profit margins. Additionally, the completion of the "Hai'an Project" in Nantong, China this year is expected to bring substantial revenue and profit contributions to ACHEM.
In recent years, YC has been actively expanding from packaging materials and tapes into upstream raw materials, aiming to leverage vertical integration across the supply chain. This strategic cooperation with Toyota Tsusho is expected to effectively expand sales channels and greatly benefit future international market development. |
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