Covestro, a leading supplier of high-performance resins, goes on to expand its Thermoplastic Polyurethanes business (TPU) by raising its stake in the Joint Venture DIC Covestro Polymer Ltd. DCP was established in the year 2000 as a 50/50 joint venture, which has now become 80% stakes of Covestro from 50% earlier.
Covestro has made the investment in low double-digit million EUR as part of its expansion of global TPU business. Both parties agreed to close the deal by early second quarter of 2019, subject to the approval from the relevant authority.
DCP is a joint venture between Dainippon Ink & Chemicals Inc. (today DIC) and Bayer Ltd. (the shares in DCP were later transferred to Bayer Material Science Ltd., today Covestro Japan Ltd.). DCP, a leading TPU supplier in Japan offering a unique and wide range of TPU specialty products and TPU brands such as PANDEX, Desmopan, and Texin, is preferred in a wide range of applications such as automotive, electric appliance, IT, health care and sports with its variety and outstanding versatility.
Dr. Markus Steilemann, CEO of Covestro, said, “The strong and long-term partnership of both companies, as well as our thorough understanding of the future growth potential make this acquisition a fitting step in Covestro’s growth strategy focusing on sustainability driven innovation.”
Covestro is one of the top 3 producers of TPU. The TPU business accounted for approximately 10% of the segment sales in FY 2017. The global TPU industry is estimated to grow at a long-term average of 6% p.a., whereas Covestro outgrew the industry with double-digit core volume growth per year in the past three years.
DIC is also a partner for Covestro in other Coatings, Adhesives, and Specialties business.