Japanese chemicals and materials group, Eneos Holdings, has finished its acquisition of TPC Holdings, parent of US-based C4 chemicals processor TPC Group, Inc. TPC is now a consolidated subsidiary inside Eneos’ High Performance Materials segment.
Eneos had declared the acquisition and signed the merger agreement on August 7. The acquisition cost is recently estimated at $758-mn, to be finalized after adjustments consisting of net interest-bearing debt. The deal was performed through a merger among TPC and a special purpose company set up by Eneos’ wholly-owned US subsidiary, with TPC as the surviving entity. TPC’s existing 27,793,565 shares were cancelled, with former shareholders entitled to cash consideration, and Eneos now holds 100% of TPC.
TPC Group—one of the largest independent processor of C4 hydrocarbons in North America—separates and purifies C4 streams to manufacture butadiene and its derivatives. Eneos said TPC holds the largest market share in North America in butadiene, raffinate, 1-butene and polybutene.
Eneos said the purchase is part of the “portfolio restructuring” pillar of its Fourth Medium-Term Management Plan. It noted shrinking domestic demand in Japan, driven by using population decline, as the reason for searching for growth overseas, and called the United States an attractive market given low-cost shale gas-based feedstocks and sturdy demand growth.
With TPC, the Eneos Group will hold the world’s third-largest butadiene manufacturing capacity. Butadiene is the primary raw material for Eneos’ elastomers, such as solution-polymerised styrene-butadiene rubber (S-SBR) for fuel-efficient tyres, and the company targets to enhance its raw material procurement and its responsiveness to market fluctuations. It plans to use TPC as a foothold for collaboration with existing businesses, expansion into adjacent businesses and supply chain reinforcement in North America.
