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Huntsman Takes Stake in Japanese Foam Company

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Salt Lake, Utah-based Huntsman Corporation (NYSE: HUN  ) has taken a 20% stake in Japan's Nippon Aqua Co., Huntsman announced today.

Nippon Aqua makes spray polyurethane foam (SPF) insulation, and is said to be "the" market leader for this product's manufacture in Japan. It's also, incidentally, a subsidiary of local residential home builder Hinokiya Holdings Co.

If that sounds like an interesting interlocking of interests, consider this one: Huntsman, which now owns one-fifth of Nippon Aqua, also sells various advanced polyurethane systems to Nippon Aqua as a customer. As part of its agreement to take a stake in the company, Huntsman signed a 10-year agreement to keep Nippon Aqua supplied with the chemicals it needs to manufacture its foam. Thus, in one fell swoop, Huntsman has tightened up its relationship with not one, but two customers, at various points downstream in its supply chain.

Financial terms were not disclosed on either part of the deal -- Huntsman's investment, or its supply agreement. Regardless, investors applauded the deal, bidding up Huntsman shares 1.3% in Thursday trading, to close at $19.18.


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Rich Smith
TMFDitty

As a defense writer for The Motley Fool, I focus on defense and aerospace stocks. My job? Every day of the week, I'm monitoring the news, figuring out the winners and losers, and tracking down the promising companies for you to invest in. Follow me on Twitter or Facebook for the most important developments in defense & aerospace, and other great stories.

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7/2/2015 4:04 PM
HUN $21.62 Down -0.21 -0.96%
Huntsman Corp CAPS Rating: *****

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