Japan's Sumitomo to sell oil sales arm to Idemitsu

25 March 2008 11:56  [Source: ICIS news]

TOKYO (ICIS news)--Japan’s Sumitomo Corp will sell all the shares of its wholly-owned subsidiary Sumisho Oil Corp to refiner Idemitsu Kosan due to the prevailing harsh business environment, the trading house said in a statement on Tuesday.

The companies have signed a sale agreement and the shares would be transferred by 30 June, it added without disclosing any financial details.

Japan’s petroleum industry had been suffering from reduced internal demand for oil fuels on high crude costs and the domestic oil retail market was no longer profitable, Sumitomo said.

Idemitsu said it would benefit from the acquisition as it would help the company strengthen its domestic distribution network.

The oil refiner had a wide industrial fuels sales network in Hokkaido and Tohoku in northern Japan, where its Hokkaido refinery distributed its products, it added.

Sumitomo Oil's operating income for the full year ended 30 March 2007 was yen (Y) 240bn ($2.37bn), while its net sales were Y10,500bn.

($1 = Y101)

By: Tomomi Yokomura
+65 6780 4359

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