CEO Behind the $7 Billion Deal Sets Sights on Japan’s Chip Linchpin, JSR
The CEO of Resonac Holdings, Hidehito Takahashi, has indicated an interest in acquiring a share in JSR, the largest manufacturer of photoresists worldwide, as he gets ready for yet another round of consolidation in Japan’s chip materials industry. This action comes after Japan Investment’s $6 billion acquisition of JSR, which is anticipated to drastically alter the nation’s supply chain for semiconductor materials.
Image Source: bloomberg.com
Takahashi thinks his business is the most logical partner for JSR. Takahashi is well-known for arranging Showa Denko’s 2020 acquisition of the bigger Hitachi Chemical, creating Resonac. He shows a great desire to actively engage in JSR’s future while acknowledging the possible price.
"I believe we are the most logical partner for JSR,” said the executive who orchestrated Showa Denko’s purchase of the bigger Hitachi Chemical in 2020 that led to the formation of Resonac. "It will be expensive, so we have to think about how we’d do it, but we want to get involved.”
Japan has a vast network of relatively unknown businesses that specialise in essential materials like mask blanks and photoresists that are essential to the fabrication of semiconductors. But as demand for better semiconductor performance rises and research expenses rise, the industry is being forced to consolidate in order to remain competitive against international rivals.
One area where Japan can keep winning on the global stage is semiconductor materials, Takahashi Stated. He calls on leaders to look beyond their specialised fields and highlights the need to move away from a fragmented industry.
Resonac Hopes to Become a Chip Materials Juggernaut
With an annual revenue target of over ¥1 trillion and an EBITDA margin of at least 20%, Resonac hopes to become a chip materials juggernaut and join the ranks of multinational behemoths such as 3M and DuPont de Nemours. The 61-year-old Takahashi emphasises that Resonac need not be the only force towards consolidation, expressing a willingness to resign as CEO if doing so helps realise this goal.
"I'm not interested in Resonac swallowing everything. There is an ideal the industry should pursue. Let's think about how we can get there while keeping everyone happy," Takahashi states, emphasizing the desire to contribute to industry consolidation.
Resonac’s chip materials division is anticipated to earn a profit in line with its record-breaking 427 billion in revenues in 2022. The business is positioned well in the changing semiconductor environment thanks to its focus on providing essential materials for next-generation circuits, which is being pushed by the expanding usage of artificial intelligence.
Resonac is reorganising its operations to focus more of its efforts on the semiconductor industry. The company intends to sell off parts unrelated to semiconductors, including one of its oldest divisions, petrochemical materials. Takahashi says that efforts are being made to remove this unit off the company’s balance sheet, even if there may be difficulties in finding a buyer for it.
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