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Arch Chemicals agreed to sell most of its microelectronics materials business to Fuji Photo Film on October 25, 2004. The sale closed on November 30, 2004, for final adjusted proceeds of $160.5 million, according to Arch’s 2004 annual filing. The deal included operations across North America, Europe and Asia and Arch’s 49% stake in a Japanese joint venture—but not all of Arch’s microelectronics-related assets.
What Arch sold to Fuji Photo Film
The transaction covered Arch’s microelectronics manufacturing and research and development facilities in North America, Europe and Asia, along with its 49% interest in FUJIFILM Arch Co., Ltd., a Japanese joint venture. The business supplied materials used by semiconductor and flat-panel-display manufacturers.
Its product lines included photoresists, formulated products, polyimides and thin-film systems. Arch’s filings describe the completed disposition and the assets involved in the 2004 Form 10-K.
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What Arch kept
Arch did not sell every operation or asset connected to microelectronics. It retained its 50% interest in Planar Solutions LLC, its dedicated microelectronics manufacturing facility in Brandenburg, Kentucky, and its chemical management services business.
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The Brandenburg facility was to supply certain raw materials to Fuji during a transition period of up to two years. This retained operation was a significant exception to the broad description of the sale as a microelectronics business divestiture.
How much Fuji paid
The figures differ because they refer to different stages of the transaction and different working-capital estimates.
- At announcement: EE Times reported approximately US$160 million in consideration on October 25, 2004.
- At closing: Arch’s December 6, 2004 Form 8-K reported approximately $161.6 million in cash proceeds based on a preliminary working-capital estimate.
- After final adjustment: Arch’s 2004 Form 10-K reported $160.5 million in proceeds, inclusive of the final working-capital adjustment.
These amounts describe the same transaction at different reporting stages, not separate payments or competing estimates of a market value. The preliminary proceeds appear in the closing Form 8-K; the final adjusted amount is in the 2004 Form 10-K.
Why Arch said it sold the business
Arch presented the sale as a portfolio-focus and resource-allocation decision. Michael Campbell, then Arch’s chairman, president and CEO, said the divestiture would let the company focus its portfolio and redeploy resources toward growth opportunities in its Treatment Products platform. He also described Fuji as an established technology provider and referred to the companies’ 21-year strategic alliance.
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Campbell’s explanation appeared in EE Times’ October 25, 2004 announcement report.
Quick Recap
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When the agreement was announced and completed
- October 25, 2004: Arch announced its agreement to sell most of the business to Fuji Photo Film. The announcement described an expected year-end closing, subject to conditions.
- November 30, 2004: The transaction closed, as confirmed in Arch’s SEC filings.
- December 6, 2004: Arch filed a Form 8-K reporting the completed disposition and preliminary cash proceeds.
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