Mitsubishi Materials to chip in $90 million to buy into Masan mining unit

As part of the strategic alliance, Mitsubishi Materials Corporation (MMC) will subscribe for over 109.9 million newly issued ordinary shares via a private placement for a total cash consideration equivalent to $90 million. 

On completion of the transaction, MMC will own 10 per cent of the fully diluted share capital of Masan High-Tech Materials (MHT) and becoming the second-largest shareholder.    

Post completion of the investment, the parties shall discuss developing a separate business unit to strengthen and unlock synergies for each respective parties’ mid-stream tungsten platform.

The ability to offer cutting-edge solutions to customers and the strategic flexibility of being integrated across the value chain is a critical factor in delivering sustainable growth and will continue to be a critical factor in the tungsten space. 

MHT prides itself on delivering continuously improved and innovative product offerings. This is one of the only tungsten platforms that benefit from a consistent supply of primary (concentrates) and secondary raw (recycled) materials that are then further processed into the finest quality oxides, powders, carbides, and chemicals. 

The success of MHT is underpinned by a combination of world-class research and development with dedicated applications engineers that have a track record of delivering fine-tune specifications to meet end customers evolving demands.

Post the closing of the H.C Starck acquisition (HCS - a leading global mid-stream tungsten business), in June this year, Mitsubishi Materials’ participation as a strategic partner is a validation of management’s transformation into a vertically integrated high-tech tungsten platform. 

MMC will add significant value as a strategic partner and through partnering parties will be positioned to develop better leading-edge solutions for end customers which will accelerate growth. 

The first solution is establishing opportunities for joint collaboration and investment in revolutionary research and development of key technologies to enhance the parties’ respective high-tech tungsten portfolio

The second is enhancing the ability of both MMC and MHT to provide industry-leading quality and performance of high-tech tungsten materials products going forward. And the third is strengthening the sales network in the Asia Pacific region, which will broaden the consumption of MHT’s fine powders in the Asia Pacific region.

Craig Bradshaw, chief executive officer of MHT said that forging a strategic alliance with MMC will certainly accelerate our vision to become an end to end global high-tech industrial materials platform. 

"Our customers will benefit the most as this partnership will strengthen our capabilities to supply, quality, and innovative products and solutions. The alliance also positions MHT and HCS to build a mid-stream tungsten Asian franchise, which is the missing piece of our strategic puzzle,” said Bradshaw.

Makoto Shibata, director, chief financial officer of MMC, said: “We have set the tungsten business including the cemented carbide tool business to be one of the major pillars of our growth strategy. I am excited about a new collaboration, which our investment in MHT will create and must have a significant impact on our future.”

Credit Suisse acted as exclusive financial advisor to MHT.