Furukawa, Showa Denko May Merge Aluminum Units, Nikkei Says

By Tak Kumakura

Jan. 20 (Bloomberg) -- Furukawa Electric Co. and Showa Denko KK are in talks to merge their aluminum businesses, the Nikkei newspaper reported, without citing anyone.

The merger would create Japan’s biggest aluminum maker with a domestic market share of more than 20 percent, the report said. The two companies seek to reach an agreement by summer and complete the integration by 2010, the Nikkei said.

Under the plan, Furukawa’s Furukawa-Sky Aluminum unit would take a majority stake in Showa Denko’s aluminum business, the newspaper reported. Showa Denko may receive Furukawa-Sky shares in exchange instead of cash, Nikkei said.

Furukawa and Showa Denko didn’t answer telephone calls made by Bloomberg News before regular business hours.

To contact the reporter on this story: Tak Kumakura in Tokyo tkumakura@bloomberg.net.