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Acquisition of Carbon Fibre Business in the US

03 September 2004

Toho Tenax is to unite with Acordis, a leading fibre manufacturer based in the Netherlands, to acquire the PAN-based carbon fibre business in the United States.

Toho Tenax Group has been supplying carbon fibres and carbon fibre related products worldwide from its manufacturing bases in Japan and Germany. However, the absence of a manufacturing base in North America, the largest market for carbon fibres, has limited the company's sales share in North America.

The company has now identified the establishment of a supply system in the United States, Europe and Japan as a high priority in its Mid-term Management Plan launched in 2003, and determined that this acquisition is an appropriate step toward expanding its share in North America from the supply and demand balance point of view in the carbon fibre market.

With reports suggesting that the demand for carbon fibres is expected to continue growing at an annual rate of approximately 10%, Toho Tenax Group will utilize the manufacturing base obtained through this acquisition to supply to both the North American domestic market and global markets to meet this demand.

Toho Carbon Fibers (TCF), a wholly owned subsidiary of Toho Tenax, will acquire the carbon fibre business operated by Fortafil Fibers, Inc. (FF), a wholly owned subsidiary of Acordis.

Fortafil Fibers, Inc. (wholly owned subsidiary of Acordis), based in Tennessee, USA produces an annual production capacity of 3,500 tons large-tow carbon fibres. Following the acquisition, a part of the current 3,500-ton capacity, large-tow (LT) capacity will be converted into a 700-ton regular-tow (RT) capacity and a 1,400-ton oxidized PAN fibre capacity within one year of the acquisition.





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