Mitsui Chemicals said on Monday it will acquire JSR, Japan's leading maker of the light-sensitive chemicals at the heart of chip manufacturing, in a 1.84 trillion yen ($11.6 billion) deal that would create the country's largest supplier of advanced lithography materials.
The purchase, from state-backed fund Japan Investment Corp (JIC), is among the largest ever in the semiconductor materials sector and more than double the $4.55 billion Showa Denko paid for Hitachi Chemical in 2020, Reuters reported, citing a regulatory filing.
The Development Bank of Japan will invest 200 billion yen alongside Mitsui, which plans to fund the deal with a 1.64 trillion yen bridge loan from its main banks and a share sale worth up to 150 billion yen.
Why JSR matters to the chip industry
JSR makes photoresists, the light-sensitive coatings that let lithography machines print circuit patterns onto silicon wafers. In an investor presentation, Mitsui described JSR as the world's second-largest maker of photoresists for advanced logic chips and the only company able to offer both leading types of EUV photoresist technology.
Mitsui itself is the world's top maker of EUV pellicles, the ultra-thin membranes that protect the masks used in extreme ultraviolet lithography. Combined, the two companies would form Japan's largest integrated supplier of advanced lithography chemicals, at a moment when Tokyo is pushing to strengthen its domestic chip supply chain.
JSR's semiconductor materials sales rose from 157.9 billion yen in fiscal 2024 to 196.0 billion yen in fiscal 2025, according to Mitsui's presentation. For the fiscal year ended March 2026, JSR reported revenue of 440.7 billion yen and core operating profit of 62.3 billion yen, with 6,951 employees.
A deal far bigger than the buyer
The price tag is striking: Mitsui's own market capitalisation stood at about 664.6 billion yen, according to LSEG data cited by Reuters — far smaller than the 1.84 trillion yen it is paying. The valuation breaks down into 1,392.1 billion yen of equity value and 447.9 billion yen of debt and other items.
Investors were unimpressed. Mitsui's shares fell around 13 percent on Monday, after dropping more than 10 percent last week when Reuters first reported Mitsui as the likely buyer. The company said its net debt-to-operating cash flow ratio would exceed 4.0 immediately after closing.
Mitsui said the combination would deliver an additional 40 billion yen in annual operating profit by 2035. It also plans to sell off JSR's life sciences unit and other non-core businesses, aiming to restore a sound financial position within three years.
JSR's second sale in three years
The deal is JSR's second change of ownership in three years. JIC, a fund overseen by Japan's finance ministry, took JSR private in 2024 for about 900 billion yen, delisting it from the Tokyo Stock Exchange that June, and ran an auction that ended with Mitsui as the winner.
The acquisition still needs competition and foreign-investment clearances in Japan and other countries. Mitsui aims to close it in the second half of the fiscal year ending March 2028.
For Japan's chip ambitions, the deal consolidates two critical links in the lithography chain under one roof. For Mitsui's shareholders, the question is whether the bet pays off before the debt bill comes due.
