Sunnypol Optoelectronic Technology Intends to Acquire Part of Sumitomo Chemical's LCD Polarizing Film Business

Sumitomo Chemical has decided to transfer its LCD polarizing film business in China to Sunnypol Optoelectronic Technology. Sunnypol Optoelectronic Technology intends to acquire some of the company's equity and related assets and services related to the LCD polarizing film business held by Sumitomo Chemical and its controlled affiliates, mainly including 100% equity of XUYOU Electronic Materials (Wuxi) Co., Ltd., 100% equity of Sumika Huabei Electronic Materials (Beijing) Co., Ltd. and some related assets and services. The relevant transaction agreement is signed on December 25, 2024.

After the completion of this transaction, the acquired assets will be operated by Liyou Optoelectronics, a holding subsidiary of Sunnypol, and will not be included in the company's consolidated financial statements. This reorganization will not revise Sumitomo Chemical's full-year financial forecast as of March 31, 2025.

Sumitomo Chemical established Sumika Huabei Electronic Materials (Beijing) Co., Ltd. in 2009 and XUYOU Electronic Materials (Wuxi) Co., Ltd. in 2016 to meet the demand for polarizing films for the development of China's large-scale LCD industry. Its sales revenue for large-scale LCD polarizing films in China reached 100 billion yen at its peak.

However, considering the changes in the business environment such as the maturity of the LCD polarizing film market in China in recent years, Sumitomo Chemical has studied the possibility of reorganizing its business using the best owner principle and believes that reorganization, including the transfer of subsidiary equity to local polarizing film manufacturers, will be the best way.

Sumitomo Chemical is shifting the focus of its polarizing film business to areas where the company can exert its technological advantages. In the past few years, the company's sales of polarizing films in high-performance fields such as OLED and automotive applications have increased significantly. As the market in these fields is expected to grow significantly, the company will continue to strengthen product development and strengthen the supply chain in an effort to further expand its polarizing film business.