DEAL FEVER STRIKES JAPAN

MITSUBISHI RAYON and Mitsubishi Chemical have formed separate joint ventures, the former with Saudi Basic Industries Corp. (SABIC) and the latter with two other Japanese firms. But overshadowing both deals are reports emerging from Japan that Mitsubishi Chemical is in talks to acquire Mitsubishi Rayon. Mitsubishi Rayon and SABIC have agreed in principle to a joint venture that will build a $1 billion methyl methacrylate (MMA) complex in Saudi Arabia. The 50-50 venture will use an ethylene-based MMA process developed by Lucite International, a British company that Mitsubishi Rayon finished acquiring in June for $1.6 billion. MMA has traditionally been manufactured by reacting hydrocyanic acid with isobutylene. Lucite’s process, in contrast, uses the cheaper raw materials ethylene, methanol, and carbon monoxide. Last fall, the company started up a 120,000-metric-ton-per-year MMA plant in Singapore that represents the first commercial application of the new technology. Soon after, Mitsubishi Rayon, itself a ...