Japanese oil refiner Idemitsu Kosan Co., Ltd announced it has finalized the deal to merge with Japan-based oil producer Showa Shell Sekiyu, which is also the parent company of Japanese Copper/Indium/Selenium (CIS) thin film PV module manufacturer, Solar Frontier.
Idemitsu agreed to acquire Showa Shell trough a share exchange to be implemented on April 1, 2019, in which Idemitsu Kosan will distribute its shares to shareholders of Showa Shell and acquire all of the issued shares of Showa Shell, Idemitsu said in its official statement. According to Reuters, this transaction may be worth approximately US$5.6 billion. The preliminary agreement for the merger of the two companies was closed in July.
The new integrated company resulting from the operation will maintain the name Idemitsu, while Showa Shell shares will be delisted.
Although the oil business will remain the main source of income and activities of the new entity, it will also actively promote various renewable energy power sources, such as wind, solar, biomass, and geothermal power generation, said Idemitsu in a statement.
“In the solar panel business, the New Integrated Company will provide products leveraging its unique thin film solar cell technologies and make efforts to develop a self-consumption model as distributed energy resources,” it added, without providing further details or directly citing Solar Frontier.
Idemitsu also said, however, that due to the current expansion of energy demand worldwide, it will make efforts to maintain and improve the value of existing petroleum and coal resources, and develop gas fields in Asia, with coal being defined as a “stable and inexpensive energy source.”
Solar Frontier has embarked upon a number of strategic changes over the past two years. In early January, it transferred part of its business to RS Renewables, a new unit that was created through an incorporation-type company split. The new company is responsible for selling PV modules and developing solar projects in markets outside of Japan.
Furthermore, it adjusted its manufacturing strategy. In November, it revealed plans to consolidate production at its flagship 900 MW Kunitomi facility in Japan’s Miyazaki prefecture, as part of this shift.
In February, meanwhile, the company said it was seeking new opportunities in the Japanese market, where the self-consumption of electricity is becoming increasingly important in the residential solar segment, offering “higher added value” than those in more competitive overseas markets.
For this segment, the company conceived it SmaCIS solar panels, which are said to provide greater coverage on the uniquely shaped rooftops of detached homes in Japan.