September 9, 2019
Denka Company Limited

Notice Regarding Decision to Increase MS Resin Production in Singapore byRenovating Polystyrene Production Facilities
Denka Company Limited (headquarters: Chuo-ku, Tokyo; president: Manabu Yamamoto;hereinafter “Denka”) has decided to terminate the production of polystyrene (GPPS*1; Productname: Denka Styrol) at its consolidated subsidiary (Singapore Private Limited; hereinafter,“DSPL”) and boost the production capacity of MS resin*2 by renovating the production facility, as
part of business portfolio transformation initiatives implemented under the Denka Value-Upmanagement plan. The total amount of investments pertaining to the renovation of the facilities isapproximately 2.7 billion yen.
MS resin is currently in a situation where the supply capacity is not meeting demand. This is
attributable to optical applications of the material as light guide plates for backlights whose
demand is sharply growing as LCD TVs and monitors employ larger displays and narrower
frames, as well as being partly due to the expansion of non-optical applications for products suchas cosmetics containers whose needs are growing significantly in the Asia Pacific area, including
China, among other countries.
To respond to growing demand, Denka, which is the leading manufacture of MS resin, will double
production capacity of MS resin (capacity for the expansion: up 70,000 tons, total 140,000 tons)
by renovating the existing polystyrene production facilities, and continue to address the rise indemand, down the road. In addition, it will step up its BCP efforts by enhancing the current single
facility-based production system to a dual facility-based production system.
Denka commenced the production and sale of polystyrene in 1997 in Singapore, with a focus on
MW-1, a highly robust GPPS which has been used in more than 30 countries around the world
including ASEAN and China.
However, with the supply of polystyrene surpassing demand in overseas markets, Denka hasrecently decided to terminate the production of polystyrene and transform its production facilities
into those for MS resin, a higher value-added functional resin.
Denka instituted the Denka Value-Up management plan to achieve 90% of operating income from
specialty businesses by fiscal 2022. Going forward, it will continue to make investments speedily
to respond to future demand, and by doing so, aim to facilitate further specialization in its corebusinesses.
1/2[Outline of the investment]* Facilities in which the investment will be made: Denka Singapore Private Limited Seraya Plant(Singapore) 40 Seraya Avenue, Singapore 627873* Purposes of the investment: Enhancement of the production capacity of MS resin by renovating
polystyrene production facilities*Investment amount: Approximately 2.7 billion yen*Commencement of operation: First half of 2021 (Termination of the sale of polystyrene: End of2020)
Impact on consolidated results: The investment does not have any impact on Denka’s
consolidated results for the fiscal year ending March 31, 2020.
*1) GPPS (General Purpose Polystyrene)
Refers to general purpose polystyrene resins*2) MS resin
Refers to methyl-methacrylate-styrene, a copolymer material comprising styrene and methyl
methacrylate (MMA) featuring high-level dimensional stability, low specific gravity and excellent
moldability, which are qualitative advantages attributable to the material having low-level moistureabsorbency. DSPL produces MS resin products that feature low contamination and an excellent
exterior in a stable fashion by leveraging precision control technologies at its plant equipped witha continuous production process. By doing so, it has been facilitating the differentiation of its
products from those of other companies and garnering high evaluations of its excellent quality inthe market.

These documents have been translated from Japanese originals for reference purposes only.
In the event of any discrepancy between these translated documents and the Japanese originals,
the originals shall prevail. The Company assumes no responsibility for this translation or fordirect, indirect or any other forms of damages arising from the translations.

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