March 14, 2018 / 11:51 PM / 5 days ago

Japan's Toray to buy TenCate to boost carbon-fiber business

(Reuters) - Japan’s Toray Industries (3402.T), the world’s largest maker of carbon-fiber composite materials, said it will buy TenCate Advanced Composites for an enterprise value of 930 million euros ($1.15 billion), as it looks to ramp up its carbon-fiber business.

Toray Industries' logo is pictured at its headquarters in Tokyo, Japan, November 28, 2017. REUTERS/Issei Kato

The deal is in line with Toray’s aim to speed up the development of technology to match growing demand in aircraft applications of carbon fiber.

"The demand for medium- and small-sized, single-aisle aircraft is growing significantly and the development of the next-generation aircraft targeting such demand is expected to intensify," Toray said in a statement.

TenCate manufactures thermoplastic prepreg, a material that improves efficiency of molding. Toray expects demand for the material to increase in line with demand for medium and small-sized mass-produced aircraft.

Toray has been building its carbon-fiber business, beginning with the 2013 acquisition of U.S.-based Zoltek Companies for $584 million.

    The deal, which is expected to be completed in the second half of 2018, is subject to approvals by regulators, TenCate said in a separate statement, adding that Toray expects to retain key management of TCAC following completion of deal.

    ($1 = 0.8087 euros)

    Reporting by Chris Thomas in Bengaluru; Editing by Stephen Coates

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