Resonac CFO reveals “investments more profitable than the JSR acquisition”: Major improvements in financials and market valuation usher in a phase of “offensive investment”《Republished》

Resonac Holdings CFO Someya Hideki (染宮 秀樹) explained that the company had reduced the approximately ¥1.1 trillion of debt that had accumulated following the acquisition of the former Hitachi Chemical by approximately ¥500 billion over five years, bringing net interest-bearing debt down to approximately ¥600 billion. With higher interest rates in mind, the company has been converting debt to fixed-rate debt to protect its financial position while maintaining its policy of not halting investment.

He discussed the company’s focus on ROIC as a financial performance measure and how its approach to assessing financials had changed. Previously, the company had placed greater emphasis on the net debt-to-equity ratio, but now focuses on the net interest-bearing debt/EBITDA multiple, which he said is expected to fall below 2x by the end of 2026. The multiple was approximately 15x immediately after the acquisition.

The company is considering separating the petrochemicals business as a partial spin-off. He pointed out that the growing feasibility of クラサスケミカル, which is being prepared for a potential listing, had changed the market’s view. The foreign ownership ratio changed from approximately 20% five years ago to approximately 40%, reaching 56% in June this year, reflecting growing recognition of the growth potential of the semiconductor materials business.

Regarding the valuation gap, he acknowledged that Resonac’s EV/EBITDA multiple had recently risen to 13–14x, but that the gap with US companies remained substantial. The company regards the combined enterprise value of the business after the separation of クラサスケミカル exceeding its value before the separation as the measure of success. The article provides an in-depth interview on the company’s investment strategy and M&A going forward, including the possibility of acquiring JSR.