Sumitomo Chemical to acquire Tanaka Chemical, bolstering battery materials

Sumitomo Chemical Co. announced a share exchange agreement to make Tanaka Chemical Corporation a wholly-owned subsidiary, effective January 30, 2026. This follows a period of challenging market conditions for Tanaka Chemical, including projected net losses for the fiscal years ending March 31, 2025, and 2026. The acquisition aims to enhance Tanaka Chemical’s corporate value through accelerated R&D, improved profitability, and stabilized cash flow by leveraging Sumitomo Chemical’s support.

The share exchange ratio is set at Tanaka Chemical’s per-share value of JPY424 divided by the average price of Sumitomo Chemical’s common stock from January 13-16, 2026. This variable ratio method was adopted to mitigate price fluctuation risk for Tanaka Chemical's shareholders. The decision was supported by a Special Committee, which confirmed the fairness of the transaction terms and procedures after deliberation and negotiation, obtaining valuation reports from independent third-party appraisers Nomura Securities and Mitsubishi UFJ Morgan Stanley Securities. Tanaka Chemical shares are scheduled for delisting from the TSE Standard Market on January 28, 2026.