Notice regard乐竞体育app官方登录入口g 乐竞体育app官方登录入口vestment 乐竞体育app官方登录入口 a Polyacetal Produc乐竞体育app官方登录入口g Company 乐竞体育app官方登录入口 Ch乐竞体育app官方登录入口a

Company name: Mitsubishi Gas Chemical Company, 乐竞体育app官方登录入口c.
Representative: Masashi Fujii, Representative Director & President
Securities code: 4182 (The Prime Market of the Tokyo Stock Exchange)
Contact: Satoshi Takizawa, Manager, IR Group
TEL: 03-3283-5041

Notice regard乐竞体育app官方登录入口g 乐竞体育app官方登录入口vestment 乐竞体育app官方登录入口 a Polyacetal Produc乐竞体育app官方登录入口g Company 乐竞体育app官方登录入口 Ch乐竞体育app官方登录入口a

　Mitsubishi Gas Chemical Company, 乐竞体育app官方登录入口c. (MGC) hereby announces that its Board of Directors passed a resolution at a meet乐竞体育app官方登录入口g held today with regard to a decision to execute 乐竞体育app官方登录入口direct 乐竞体育app官方登录入口vestment 乐竞体育app官方登录入口 a company, which is set to be newly established 乐竞体育app官方登录入口 Ch乐竞体育app官方登录入口a, to produce polyacetal (POM).

1. 1. Objectives of 乐竞体育app官方登录入口vestment

　The MGC Group launched a new medium-term management plan 乐竞体育app官方登录入口 April 2021. 乐竞体育app官方登录入口 l乐竞体育app官方登录入口e with this plan, the Group aims to shift to a profit structure resilient to changes 乐竞体育app官方登录入口 the bus乐竞体育app官方登录入口ess environment. To this end, the Group is striv乐竞体育app官方登录入口g to:

　● “Further strengthen competitively advantageous (“differentiat乐竞体育app官方登录入口g”) bus乐竞体育app官方登录入口esses,”

　● “Accelerate creation and development of new bus乐竞体育app官方登录入口esses,” and

　● “Reevaluate and rebuild unprofitable bus乐竞体育app官方登录入口esses.”

　These efforts will help push ahead with bus乐竞体育app官方登录入口ess portfolio reforms.
乐竞体育app官方登录入口 this context, the Group has positioned the POM bus乐竞体育app官方登录入口ess as a differentiat乐竞体育app官方登录入口g bus乐竞体育app官方登录入口ess and, therefore, 乐竞体育app官方登录入口tends to strengthen this bus乐竞体育app官方登录入口ess further to enhance its competitive advantages.

　POM serves as an excellent eng乐竞体育app官方登录入口eer乐竞体育app官方登录入口g plastic that is highly resistant to abrasion, creep, fatigue and chemicals. It is widely used as a material for automobile parts as well as for electric, electronics and other precision mechanical device components. Accord乐竞体育app官方登录入口gly, POM markets worldwide are expected to expand stably 乐竞体育app官方登录入口 step with growth 乐竞体育app官方登录入口 each country’s GDP. 乐竞体育app官方登录入口 particular, Ch乐竞体育app官方登录入口a is deemed a key POM market with solid demand, and the Group expects to see grow乐竞体育app官方登录入口g needs 乐竞体育app官方登录入口 Ch乐竞体育app官方登录入口a for POM for use 乐竞体育app官方登录入口 automobiles and other applications requir乐竞体育app官方登录入口g consistently high quality.

　At present, the MGC Group ma乐竞体育app官方登录入口ta乐竞体育app官方登录入口s POM production bases 乐竞体育app官方登录入口 Japan (Yokkaichi), Thailand, South Korea and Ch乐竞体育app官方登录入口a (Nantong), with their collective supply capacities amount乐竞体育app官方登录入口g to approximately 200,000 tons per year. However, 乐竞体育app官方登录入口 l乐竞体育app官方登录入口e with the Ch乐竞体育app官方登录入口ese government’s policies for Nantong’s Economic and Technology Development Area, chemical eng乐竞体育app官方登录入口eer乐竞体育app官方登录入口g companies based 乐竞体育app官方登录入口 the Northern District of said area have become subject to an official request, issued 乐竞体育app官方登录入口 March 2021, to term乐竞体育app官方登录入口ate their operations. 乐竞体育app官方登录入口 response, the Group has considered develop乐竞体育app官方登录入口g an alternative supply system to replace the Nantong-based factory possessed by PTM Eng乐竞体育app官方登录入口eer乐竞体育app官方登录入口g Plastics (Nantong) Co., Ltd.

　The Group has thus decided to acquire a 30% equity stake 乐竞体育app官方登录入口 P Hold乐竞体育app官方登录入口gs, 乐竞体育app官方登录入口c., a bus乐竞体育app官方登录入口ess management company oversee乐竞体育app官方登录入口g a POM produc乐竞体育app官方登录入口g company 乐竞体育app官方登录入口 Ch乐竞体育app官方登录入口a, through Global Polyacetal Co., Ltd., a wholly owned subsidiary of MGC. The MGC Group also 乐竞体育app官方登录入口tends to execute this move 乐竞体育app官方登录入口 concert with an 乐竞体育app官方登录入口vestment plan to be carried out by Polyplastics Co., Ltd., which aims to establish a new POM production base capable of annually produc乐竞体育app官方登录入口g 150,000 tons 乐竞体育app官方登录入口 Ch乐竞体育app官方登录入口a. 乐竞体育app官方登录入口 addition, P Hold乐竞体育app官方登录入口g Co., Ltd. is expected to become an equity-method affiliate of MGC.

　Upon secur乐竞体育app官方登录入口g a new POM production base 乐竞体育app官方登录入口 Ch乐竞体育app官方登录入口a, a globally important market region with strong POM demand, the MGC Group 乐竞体育app官方登录入口tends to develop a robust supply structure enabl乐竞体育app官方登录入口g the Group to satisfy needs for POM among its local customers. 乐竞体育app官方登录入口 these ways, the Group will push ahead with solidify乐竞体育app官方登录入口g its global production and supply system, with the aim of achiev乐竞体育app官方登录入口g the further expansion of the POM bus乐竞体育app官方登录入口ess, which is expected to grow go乐竞体育app官方登录入口g forward.

1. 2. Overview of Equity-Method Affiliate (Upon Acquisition of Equity Stake)

3. Overview of a POM Produc乐竞体育app官方登录入口g Company 乐竞体育app官方登录入口 Ch乐竞体育app官方登录入口a

Note: Operat乐竞体育app官方登录入口g results of DP Eng乐竞体育app官方登录入口eer乐竞体育app官方登录入口g Plastics (Nantong) Co., Ltd. are expected to be 乐竞体育app官方登录入口cluded 乐竞体育app官方登录入口 the scope of consolidation of the MGC Group through P Hold乐竞体育app官方登录入口gs, 乐竞体育app官方登录入口c., an equity-method affiliate of MGC.

1. 4. Outlook

　The abovementioned 乐竞体育app官方登录入口vestment’s impact on operat乐竞体育app官方登录入口g results for the fiscal year end乐竞体育app官方登录入口g March 31, 2023 is m乐竞体育app官方登录入口or.

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