Stephanopoulos

The plan was disclosed as the second largest Japanese chemical company said it expects to post a loss of about $75 million for the fiscal year ending March 31, a sharp downward revision from about $150 million of net profit it had estimated in May. The announcements signal the beginning of a corporate restructuring that Chief Technology Officer George Stephanopoulos recently predicted (C&EN, Sept. 10, page 17). But at first glance the plan is far from revolutionary.

There are no immediate layoffs or immediate transformations in the business portfolio. However, Mitsubishi hopes to strengthen the competitiveness of its petrochemical operations in Japan through ventures with unspecified domestic or foreign partners.

Petrochemicals represent 40% of Mitsubishi's sales. The company runs Japan's largest ethylene cracker.

Japanese chemical industry analyst Masami Sawato at HSBC Securities in Tokyo says the company will pursue profitability instead of market share. Warns Sawato: "There is no action plan with a time frame, or an idea of which product they are going to be restructuring or businesses they will consolidate; they won't have such a focus on volume."

Mirroring moves Stephanopoulos implemented in the company's R&D organization, Mitsubishi will reorganize its businesses into three groups: petrochemicals, pharmaceuticals and related businesses, and specialty chemicals and related businesses.

In specialty chemicals, Mitsubishi says it will work much more closely with its customers in the development of new materials and specialty polymers. It will also conduct joint research with foreign academic organizations in areas such as optoelectronic materials and nanotechnology.

To immediately improve profitability, the company will reduce executive pay by up to 20%. It will also reduce capital investment.

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