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Business deals

David buys Goliath: Showa Denko to bet it all on Hitachi Chemical

Magnetic disk leader aims to transform into supplier for 5G chip industry

Aluminum alloy bars manufactured by Showa Denko.

TOKYO -- Japanese materials maker Showa Denko has moved to spend roughly 900 billion yen ($8.26 billion), or double its market value, to purchase domestic rival Hitachi Chemical, demonstrating its resolve to remain relevant in today's global industry.

Showa Denko won preferential negotiating rights to purchase Hitachi Chemical, Nikkei reported Monday. Showa Denko is expected to execute a tender offer as early as next month that will target all shares, including the 51% interest from parent Hitachi.

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