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Business deals

Japan chemical merger foiled by divergent diaper visions

Nippon Shokubai and Sanyo Chemical see different paths out of coronavirus funk

Global demand for diapers is on the rise, but growing competition and the coronavirus have complicated matters for Japanese producers of the polymers that go inside them.   © Reuters

OSAKA/KYOTO -- Japanese chemical makers Nippon Shokubai and Sanyo Chemical Industries announced Wednesday that they have canceled their planned merger, as the coronavirus pandemic highlights their diverging strategies on a key material used in disposable diapers.

The companies announced in May of last year that they would merge in October 2020, creating the world's largest producer of superabsorbent polymers, or SAPs. But this was postponed earlier this year as earnings declined at Nippon Shokubai.

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