Tokuyama announced a major strategic adjustment to transfer its domestic cement and curing agent sales business to Pacific Cement Company as a whole, with a transaction value of about 37 billion yen ( $250 million). The two sides aim to complete the transaction in October 2026, but the transaction still needs to be approved by the relevant regulatory authorities. This marks an important turning point in Tokuyama's cement market layout in Japan, and is also a key step in its cement business restructuring plan.
According to the transaction arrangement, Deshan Company will first set up a new wholly-owned subsidiary, and then inject the existing domestic cement sales business and related subsidiary assets into the new company as a whole. Upon completion of the internal reorganization, Tokuyama will sell all of its shares in the wholly owned subsidiary to Pacific Cement. Through this structured arrangement, both parties can achieve a smooth transition of business, while ensuring the continuity of customer relationships and operational systems.
The divestiture reflects Tokuyama's deep judgment on the long-term structural decline of the Japanese cement market. Domestic cement consumption in Japan has experienced a significant downward trend since demand peaked in 1990. Faced with this irreversible market shrinkage, Tokuyama not only decided to withdraw from the sales sector, but also considered completely stopping cement production activities by fiscal year 2028. This series of measures shows that the company is accelerating the transformation from traditional cement business to new areas with more growth potential.
In terms of financial impact, the transferred cement sales business accounted for about 13% of Tokuyama's consolidated operating income in the fiscal year ending March 2025. Although this part of the revenue is not the largest, considering that it is part of the company's core traditional business, the divestiture means that Tokuyama is decisively reducing non-strategic assets to optimize resource allocation and improve overall profitability. After the completion of the transaction, Tokuyama's business portfolio will be more focused on high value-added new materials and other growth businesses.
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