OSAKA (Nikkei)--Arakawa Chemical Industries Ltd. said Wednesday that it has begun negotiations with Dow Chemical Co. toward purchasing the U.S. chemical firm's hydrogenerated hydrocarbon resin operations in Germany.
The purchase will cover Dow's production facilities and its 60% stake in a sales joint venture with Arakawa. The total price tag is expected to reach several billion yen.
Hydrogenerated hydrocarbon resins are used as an adhesive for paper diapers and food packaging.
The move will double Arakawa's production capacity to 30,000 tons a year, as well as enable the company to develop a comprehensive framework for European production and sales, in addition to bolstering profitability.
Dow has been reorganizing its global operations. It sold a portion of its agriculture-use pesticide business to Nippon Soda Co. (4041) in March.
(The Nikkei May 27 morning edition)