Sanlipu Subsidiary to Acquire Sumitomo Chemical's LCD Polarizer Business

On December 24, Sanlipu announced that its associated company, Hubei Sanlipu Optoelectronic Technology Co., Ltd. (hereinafter referred to as "Hubei Sanlipu"), through its subsidiary Hubei Liyou Optoelectronic Technology Co., Ltd. ("Liyou Optoelectronics"), plans to acquire shares, assets, and services related to the LCD polarizer business held by Sumitomo Chemical and its affiliated companies. The relevant transaction agreement is expected to be signed on December 25, 2024.

This transaction does not constitute a related-party transaction and does not meet the standards for a major asset restructuring as defined in the Administrative Measures for the Significant Asset Restructuring of Listed Companies.

The announcement further stated that the transaction includes part of Sumitomo Chemical's LCD polarizer business, specifically 100% equity of Asahi Sumitomo Electronic Materials Technology (Wuxi) Co., Ltd. ("Asahi Sumitomo Wuxi") and 100% equity of Sumika Huabei Electronic Materials Technology (Beijing) Co., Ltd. ("Sumika Beijing"), as well as related assets and services. After the transaction is completed, the acquired assets will be operated by Hubei Sanlipu's subsidiary Liyou Optoelectronics and will not be consolidated into Sanlipu's financial statements.

Meanwhile, Sumitomo Chemical also issued an announcement on the same day, explaining the background of its restructuring decision. The company stated that to cope with the rapid development of the Chinese LCD industry and the expanding demand for polarizer films, it established Sumika Beijing in 2009 and Asahi Sumitomo Wuxi in 2016, growing China's LCD polarizer film business to a scale with sales of 100 billion yen. However, considering the maturity of the Chinese LCD polarizer market and changes in the environment, Sumitomo Chemical decided to restructure the business from the perspective of the "best owner" to achieve sustainable growth in the future.

Sumitomo Chemical also mentioned that the company is committed to shifting to areas where its technological advantages can be better leveraged, particularly in high-performance sectors such as OLED and automotive applications, where sales have grown significantly in recent years and are expected to maintain high growth in the future. The company will continue to focus on developing and preparing supply chains to expand profitability in the polarizer business.

Additionally, it is noteworthy that on December 18, Sumitomo Chemical announced that it had transferred all its equity in two Chinese businesses related to polypropylene (PP) composites and thermoplastic elastomers (TPE) to Guangzhou Shitian Materials Technology Co., Ltd., completing the handover of plants in Zhuhai and Dalian.