Cabot Corporation Completes Acquisition of Tokai Carbon (Tianjin) Co., Ltd Carbon Black Plant in China

Rhea-AI Summary

Cabot Corporation has successfully completed the acquisition of Tokai Carbon (Tianjin) Co., Ltd from Tokai Carbon Group. This strategic move enhances Cabot’s manufacturing capabilities, particularly in its Battery Materials sector, with a production capacity of 50,000 metric tons of carbon black annually. The acquisition aims to support the growing demand for lithium-ion batteries, with plans to upgrade the site for battery-grade production by early 2024. Additionally, Cabot is committed to implementing advanced environmental controls in line with local regulations.

Positive

• Acquisition of Tokai Carbon enhances production capacity for lithium-ion battery materials.
• Strategic investment aligns with growth in electric vehicle markets.
• Upgrade plans for battery-grade production expected to complete by early 2024.

Negative

• Financial strain anticipated from investment in plant upgrades.
• Integration challenges may arise from the acquisition.

BOSTON--(BUSINESS WIRE)-- Cabot Corporation announced that it has completed its previously announced acquisition of Tokai Carbon (Tianjin) Co., Ltd from Tokai Carbon Group.

The acquisition expands Cabot’s manufacturing capacity to support the growth of its Battery Materials product line, while continuing to serve existing carbon black customers. The site can currently produce up to 50,000 metric tons of carbon black annually. As conductive carbon additives play a key role in battery chemistry and performance, Cabot plans to invest to upgrade the capabilities of the site to produce battery grades to support the rapid development and growth in lithium-ion batteries driven by increased electrification of the vehicle fleet.

“Lithium-ion batteries is one of the fastest growing end markets, and our customers value us as a strategic partner and industry leader in conductive carbon additives. This acquisition directly aligns with our strategy to invest for advantaged growth while developing innovative products and processes ​that enable a more sustainable future,” said Cabot President and Chief Executive Officer Sean Keohane. “We are pleased to complete this acquisition and officially welcome our new colleagues to Cabot. We are committed to investing in and connecting the capabilities across our carbon black network to further help our customers accelerate innovation, while leading in performance and sustainability.”

Cabot will also invest in advanced environmental controls to continue to operate responsibly and in compliance with local regulations, while actively working to reduce its own impact. The first phase of upgrades and conversion to battery materials is anticipated to be completed by early 2024.

ABOUT CABOT CORPORATION

Cabot Corporation (NYSE: CBT) is a global specialty chemicals and performance materials company headquartered in Boston, Massachusetts. The company is a leading provider of carbon black, specialty carbons, elastomer composites, inkjet colorants, masterbatches and conductive compounds, fumed silica and aerogel. For more information on Cabot, please visit the company’s website at cabotcorp.com.

ABOUT TOKAI CARBON CO., LTD. (TOKAI CARBON)

Founded in 1918 and headquartered in Tokyo, Japan, Tokai Carbon has for over 100 years been the market leader in a broad range of high-quality carbon and graphite products servicing numerous global customers in wide range of industries such as steel, aluminum, autos, semiconductors, and electronic components. Tokai Carbon maintains a global network of over 40 business locations across 10 countries in Asia, Europe and North America. It posted consolidated sales of JPY 259 billion and total assets of JPY 513 billion in the fiscal year ending December 31, 2021. Tokai Carbon is listed on the Tokyo Stock Exchange. For further information: www.tokaicarbon.co.jp/en/

Forward-Looking Statements

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release involving the Company that are not statements of historical fact are forward-looking statements and are subject to risks and uncertainties inherent in projecting future conditions, events, and results. Such forward looking statements include statements regarding Cabot’s expectations pertaining to the timing of plant upgrades and conversion to battery materials. Such expectations are based upon certain preliminary information, internal estimates and management assumptions, expectations, and plans. For a discussion of the risks and uncertainties that could cause results to differ from those expressed in the forward-looking statements, see “Risk Factors” in the Company’s Annual Report on Form 10-K.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220301005080/en/

Vanessa Craigie

Corporate Communications

(617) 342-6015



Steve Delahunt

Investor Relations

(617) 342-6255

Source: Cabot Corporation

FAQ

What is the significance of Cabot's acquisition of Tokai Carbon?

The acquisition expands Cabot's manufacturing capacity for battery materials, crucial for the growing lithium-ion battery market.

What is Cabot Corporation's plan for the Tokai Carbon facility?

Cabot plans to upgrade the facility to produce battery-grade materials, supporting the electric vehicle sector.

When is the upgrade to battery materials expected to be completed?

The first phase of upgrades is anticipated to be completed by early 2024.

How does this acquisition affect Cabot's stock performance?

The acquisition may positively impact Cabot's growth potential in the battery materials market, influencing investor sentiment.

What are the expected challenges following the acquisition of Tokai Carbon?

Cabot may face financial strain and integration challenges as it works to merge Tokai Carbon's operations into its business.