TonenGeneral Said to Be in Talks to Purchase Mitsui’s Oil Unit

TonenGeneral Sekiyu K.K. (5012), a Japanese oil refiner part-owned by Exxon Mobil Corp. (XOM), is in talks to buy Mitsui Oil Co. from Mitsui & Co., two people with knowledge of the matter said.

Tokyo-based TonenGeneral is seeking to expand petroleum sales channels by acquiring Mitsui Oil, which operates about 270 gas stations in Japan, said one of the people, who asked not to be identified because the information is private. The Nikkei newspaper earlier today reported the deal will be valued at as much as 50 billion yen ($510 million), without citing anyone.

Japanese oil refiners are under pressure to consolidate as the nation’s demand for petroleum products dwindles. Exxon Mobil last year cut its voting stake in TonenGeneral to 22 percent from 50.5 percent, and Brazil’s Petroleo Brasileiro SA has been considering a sale of its refinery on Japan’s southernmost island of Okinawa.

Mitsui & Co. (8031) owns 89.93 percent of Mitsui Oil, according to the Tokyo-based trading company’s website.

TonenGeneral is “actively” seeking partnerships with other companies to strengthen its petroleum-product supply chain in Japan, it said in a statement to the Tokyo Stock Exchange today in response to the Nikkei report, without mentioning talks for Mitsui Oil. Spokesmen for Mitsui & Co. and Mitsui Oil declined to comment.

Photographer: Kiyoshi Ota/Bloomberg

TonenGeneral Sekiyu KK's Kawasaki refinery stands in Kawasaki City Close

TonenGeneral Sekiyu KK's Kawasaki refinery stands in Kawasaki City

Close
Open
Photographer: Kiyoshi Ota/Bloomberg

TonenGeneral Sekiyu KK's Kawasaki refinery stands in Kawasaki City

Mitsui Oil and TonenGeneral together own Kyokuto Petroleum Industries Ltd., which operates the 175,000-barrels-a-day Chiba refinery near Tokyo, according to Mitsui Oil’s website. Mitsui Oil posted profit of 1.6 billion yen on sales of 362 billion yen for the year through March 31.

To contact the reporters on this story: Yuji Okada in Tokyo at yokada6@bloomberg.net; Tsuyoshi Inajima in Tokyo at tinajima@bloomberg.net; Shigeru Sato in Tokyo at ssato10@bloomberg.net

To contact the editors responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net; Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.