• Kyodo

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Mitsubishi Chemical Holdings Corp. will purchase a majority stake in Taiyo Nippon Sanso Corp. to provide nitrogen needed by the expanding shale gas business in the United States, Mitsubishi Chemical officials said Tuesday.

Mitsubishi Chemical plans to spend over ¥100 billion to make Taiyo Nippon Sanso a subsidiary, increasing its stake to over 50 percent through a tender offer to be carried out by the end of the year, the officials said. Taiyo Nippon Sanso will remain listed on the first section of the Tokyo Stock Exchange.

In the United States, where the mining of shale gas has expanded rapidly in recent years, production of ethylene and other chemical products made from the low-priced natural gas is expected to grow.

With the acquisition of Taiyo Nippon Sanso, Mitsubishi Chemical plans to start providing nitrogen needed to make such chemical products. Demand for nitrogen and other industrial gases is also expected to rise because they are used at shale gas mining sites.

Mitsubishi Chemical, which has health care business interests, also hopes to gain from its acquisition of Taiyo Nippon Sanso in that sector as the firm provides gases used for medical purposes.

Mitsubishi Chemical raised its interest in Taiyo Nippon Sanso to 27 percent from 15 percent last October.

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