Carbon Fiber Makers Merge

Abstract

Japan’s Toray Industries, the world’s largest producer of carbon fibers, has reached an agreement to purchase U.S. carbon fiber maker Zoltek for $584 million. The purchase will give Toray, which sells mostly aerospace-grade fiber, a stake in the growing industrial carbon fiber business. The deal also vindicates the strategy of activist investor Jeffry N. Quinn, who has been pushing Zoltek to explore ways to boost its stock price since March. Toray says it is buying Zoltek, which had sales of $186 million last year, to gain entry into the rising market for carbon fiber used to make wind turbine blades and automotive parts. The Japanese firm has about $1 billion in annual sales of mostly aerospace-grade carbon fibers, whose light weight and high strength are an asset in fuel-efficient airliners such as Boeing’s Dreamliner. When the deal is completed in late 2013 or early 2014, Zoltek will become a subsidiary ...