Henkel has officially exited the epoxy mold compound (EMC) business with sale of its Chinese manufacturing factory to a group of Chinese investors.
Official details of the sale have yet to be released by either Henkel or the new Chinese owners, but sources close to the deal revealed that the sale was completed in early spring and the new owners assumed ownership effective April 1st, 2017.
Henkel Huawei Electronics Co. Ltd. becomes Hysol Huawei Electronics Co. Ltd.
Details of the the sale reveal that Henkel sold its last epoxy mold compound factory in Lianyungang, China to a group of Chinese investors and with it, sold the Hysol brand name under which the products were sold. On the 1st of December 2005, Henkel bought a majority stake in Huawei Electronics Co. Ltd creating a joint venture that operated under the name of Henkel Huawei Electronics Co. Ltd. or HHE for short.
Effective the 1st of April 2017, the Lianyungang factory, located in the Chinese province of Jiangsu will be owned by and operate under the name of Hysol Huawei Electronics Co, Ltd. thus cleverly keeping its HHE designation while substituting the name Henkel for Hysol.
A long history of Hysol Epoxy Molding Compounds
The sale of Henkel’s epoxy molding compound business marks the beginning of a new chapter in the history of both epoxy mold compounds and the Hysol brand name. On June 26th 2000, Henkel acquired Dexter Electronics for a stunning $675 million in cash, and in the process acquired the Olean, NY USA factory that at the time had close to $80 million in sales of epoxy molding compounds and coating powders.
This was the same factory that pioneered the manufacturing of high solid epoxy mold compounds under the brand name of Hysol, a company founded in 1948 by Russ Houghton in Olean that developed the first epoxy mold compound to encapsulate transistors in 1964 – contributing to a 90% drop in the cost of transistors. Hysol merged with Dexter Corporation in 1967 and continued to sell Epoxy Mold Compound under the Hysol brand name.
In 2005, Henkel signed a joint venture acquiring a majority share of Huawei Electronics Co., Ltd. in Lianyungang, China — at the time, a domestic Chinese epoxy mold compound company that had an 80% share of the Chinese epoxy mold compound market. As part of Henkel’s epoxy mold compound strategy, they moved the all the semiconductor grade epoxy mold compound production to the new joint venture which operated under the name of Henkel Huawei Electronics Co., Ltd. IN 2008, Henkel announced it would be closing its Olean facility.
In 2010, Henkel sold their Olean, NY factory which still produced epoxy coating powders, optically clear epoxy mold compounds and industrial old compounds to a small group of local investors who continue to operate the business under the name of SolEpoxy, Inc.
On April 1st, 2017, Henkel sold their Lianyungang, China facility to a group of Chinese investors. As part of the deal, the new company also acquired the Hysol brand name, and has since operated under the name of Hysol Huawei Electronics Co. Ltd.
What is the future for Hysol Huawei and Hysol Epoxy Mold Compounds?
As with the SolEpoxy, Inc. sale, the Hysol Huawei Electronics deal was essentially the sale of a Henkel factory and a specific line of products produced at that factory. In the case of Hysol, they acquired the Hysol brand name, the epoxy molding compounds produced there and the current list of customers. They have a current distribution agreement with Henkel until the end of 2017 to give them time to set up their own sales and distribution network.
What exactly will happen to the Hysol brand name and the epoxy molding compounds made under that beloved brand name remains to be seen. Only time will tell whether Hysol Huawei Electronics Co. Ltd will be able to maintain the Hysol products and the high standards of quality and innovation that its name represents.
Please visit us at www.caplinq.com to learn more about our whole range of epoxy mold compounds including our Transfer Mold Epoxy Compounds and our Compression Mold Epoxy Compounds. If you have any other questions about the Henkel Huawei sale of their epoxy mold compound business to Hysol Huawei Electronics Co., Ltd, please feel free to leave a comment below or don’t hesitate to contact us.