January 20, 2012

Toray Industries, Inc.

Notice Regarding Decision to Make Toray Tonen Specialty Separator Wholly Owned Subsidiary

Toray Industries, Inc. (headquarters: Chuo-ku, Tokyo, President: Akihiro Nikkaku, herein referred to as "Toray") announced that it today made a decision to make Toray Tonen Specialty Separator Godo Kaisha (headquarters: Nasushiobara, Tochigi prefecture), a 50-50 joint venture with Tonen Chemical Corporation and Tonen Chemical Nasu Corporation (both are subsidiaries of Tonen General Sekiyu K.K. [headquarters: Minato-ku, Tokyo; Representative Director and President: P. P. Ducom] of ExxonMobil Group), Toray’s 100% owned subsidiary through redemption of the interest held by ExxonMobil Group.

1. Reasons behind the change in the stakes

Battery separator film (BSF) produced and sold by Toray Tonen Specialty Separator is a key part of lithium ion batteries (LIBs). LIBs are used in various mobile communication tools including mobile phone handsets and notebook PCs and are expected to continue growing in the future as the use of these electronic devices becomes even more wide-spread around the world and the devices themselves become more sophisticated. Moreover, LIBs have been adopted for electric and hybrid vehicles in recent years and this application is also expected to grow further.
At the same time, the competition in the BSF market has been intensifying against the background of remarkable market expansion in LIBs and BSF, and Japanese and foreign competitors are actively pursuing capacity expansion and technological development. This intense competition is expected to be continued in the future.
In January 2010, Toray established the 50-50 joint venture Toray Tonen Specialty Separator by making investment in Tonen Specialty Separator Godo Kaisha, which had an excellent track record in the BSF business, and has been jointly operating the business with the ExxonMobil Group. It is, however, necessary for Toray Tonen Specialty Separator to speed up its response even further upon operating the business to survive the competition in the drastically changing market environment. Towards that end, the companies, after discussion, reached the conclusion that it would be in the best interest of both companies for Toray to manage Toray Tonen Specialty Separator as a wholly owned subsidiary to further improve the company’s corporate value.
Going forward, Toray will further utilize its film production and development technology and related global operation network to contribute to the BSF business’s active profit expansion and enhancement of competitiveness by leveraging the production techniques, human resources and business expertise jointly accumulated by Toray Tonen Specialty Separator.

2. Details of the changes in the stakes

Toray Tonen Specialty Separator will refund the entire amount of the interest held by Tonen Chemical and Tonen Nasu Chemical, resulting in Toray’s 100% ownership of the company. The amount of the redemption is 53.6 billion yen.
The actual redemption is scheduled for the end of January and the company will have a new name, Toray Battery Separator Film Godo Kaisha (Chairman and President: Takeo Togano).

<Reference> Overview of the involved companies:
(1) Company Tonen General Sekiyu K.K. Tonen Chemical Corporation Toray Tonen Specialty Separator Godo Kaisha
(2) Business Refinement and sale of petroleum products and production and sale of petrochemical products Production, processing and sale of petrochemical products Production, processing and sale of synthetic resin films
(3) Established July 26, 1947 December 24, 1960 January 29, 2010
(4) Headquarters address 1-8-15, Konan, Minato-ku, Tokyo 1-8-15, Konan, Minato-ku, Tokyo 1190-13, Iguchi, Nasushiobara-shi, Tochigi Prefecture
(5) Representative P. P. Ducom(Representative Director and President) P. P. Ducom(President) Takeo Togano (Chairman),Reinhart Papen (President)
(6) Capital stock 35,123 million yen 1,000 million yen 301 million yen
(7) Major shareholders (members) and their stakes ExxonMobil Yugen Kaisha: 50.02% and others Tonen Technology G.K.:75%,
Tonen General Sekiyu K.K.: 25%
Toray Industries, Inc. 50%
Tonen Chemical Corporation: 25%,
Tonen Chemical Nasu Corporation: 25%
(8) Net sales 2,398,718 million yen (consolidated) 177,579 million yen -
(9) Net assets 248,295 million yen (consolidated) 3,823 million yen 78,850 million yen
(10) Total assets 906,846 million yen (consolidated) 75,814 million yen 82,624 million yen

* The figures under (8) to (10) are as of December 31, 2010.

3. Schedule

(1) Resolution by the Board of Directors January 20, 2012
(2) Refunding of the stake January 31, 2012 (scheduled)

4. Future outlook

Toray expects the impact of the move announced this time on its consolidated business performance for the year ending March 31, 2012 to be insignificant, but it is expected to contribute to improvement in the consolidated business performance from the medium- to long-term perspective.

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