Mitsubishi Materials to Take Over Tungsten Business in New Agreement

Vietnamese tungsten provider, Masan High-Tech Materials (MHT) has reached a framework agreement with Mitsubishi Materials Corporation (MMC) Group. Mainly, the agreement includes MMC’s intention to acquire 100% of H.C. Starck Holding (Germany) GmbH (HCS) from MHT.  Along this line, the Parties will enter into a long-term, win-win APT and tungsten oxide offtake agreement.

As a part of the agreement, Masan will retain ownership in Nyobolt, a fast-charging lithium-ion battery technology company based in the United Kingdom. Also, Masan will retain potential monetary upside from future commercialization of blackmass technology intellectual property developed by HCS.

H.C. Starck Holding, one of the world’s leading suppliers of tungsten products (PRNewsfoto/Masan High-Tech Materials)

Tungsten Recycling Business in Vietnam

In 2020, MHT acquired 100% of HCS to bring tungsten recycling technology to Vietnam to transition to a more circular and sustainable business model. In the same year, MHT partnered with MMC Group. However, MHT faced regulatory constraints limiting its ability to import tungsten scraps into Vietnam to implement its recycling strategy. Therefore, MHT intends to sell 100% of HCS to MMC Group to focus on optimizing its domestic operations. This framework agreement marks the next step in the Parties’ business cooperation.

Proceeds from the envisaged transactions aim to reduce MHT’s outstanding debt balance. The offtake agreement with MMC Group anchors MHT’s tungsten products order book and enables it to maximize its overall order book.

MHT to Retain Interest in EV Battery

Meanwhile, the retention of Nyobolt is strategic and offers a significant potential upside.

In July 2023, Nyobolt successfully demonstrated an EV concept with 6-minute charging time. Also, Nyobolt has signed Head of Terms with two major commercial customers. To date, it is in the final stage of finalizing contracts, demonstrating significant progress towards commercialization.

The combined transactions are expected to be accretive to Masan Group’s consolidated earnings and are consistent with the Group’s deleveraging target of Net Debt to EBITDA ≤ 3.5x. This also marks the first step on the Group’s continuing journey to reduce interest in non-core businesses.

Access to Global Production Hubs

MMC Group’s potential acquisition of HCS plays to its strengths in the mid-stream and down-stream tungsten value chain. The acquisition will provide MMC Group with access to HCS’s production hubs in Europe, North America and China.

Also, it will gain a comprehensive tungsten scrap recycling platform backed by proprietary intellectual property including 90 worldwide patents and another 53 patents in the application phase. 

Binding agreements between the Parties shall be subject to further discussions and customary corporate approvals.

-16 May 2024-