Showa Denko KK’s Sprout Project Continues to Grow

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Building off the momentum of its "Cheetah Project," an innovative plan that allowed Showa Denko KK (Tokyo:4004; "SDK" ) (Tokyo, Japan) to not only reduce, but also eliminate its accumulated deficit and lower its outstanding debt and labor costs, SDK is now implementing a second term strategy titled, "Sprout Project." This is a business plan that began in 2003 and runs through the end of this year and includes the investment and launching of new divisions and products to strategically enter new markets, such as electronics, automotive parts, personal care products, and environmental goods. These challenges will be met with the interconnected use of SDK's proprietary inorganic/aluminum and organic chemical process technologies.

One of the many projects associated with the company's new growth strategy is a new vinyl acetate monomer unit addition at a petrochemical production site in Oita, Japan. The new 300,000 metric tons a year unit will cost approximately $150 million and should be operational by late 2006. Oita is the site of Showa Denko's first ethylene cracker, which was constructed in 1969 and another ethylene unit was built in 1979. By the time 1990 rolled around SDK had become the largest "single-site" producer of ethylene in Japan, with a nameplate capacity of 730,000 metric tons a year.

Showa Denko has production facilities all over the world and hopes to "synergize" all the production units and technologies under one umbrella. Utilizing an intense marketing focus to increase sales in existing products and capacities, as well as develop new products and markets. The "Sprout" plan is one that works off momentum and centrifugal force that focuses on existing products becoming better and allowing these products to be the genesis of new ones.

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