Tantalum/Niobium: H.C. Starck sells its tantalum/niobium business unit to customer

H.C. Starck logo

News emerged in February that H.C. Starck had sold its Tantalum and Niobium division (H.C. Starck Tantalum and Niobium GmbH) to JX Nippon Mining & Metals Corporation (JXNMM), subject to regulatory approval. The price has not been disclosed. That deal came on the back of the sale of the Surface Technology & Ceramic Powders business to Sweden’s Höganäs AB in December 2017.

Roskill view: This news could have been expected eventually. Starck had been acquired from Bayer by the private equity companies Carlyle and Advent International in 2007. They later tried to divest it but without success. Splitting it into five separate business entities under the H.C. Starck banner was a means to make the sales easier. It appears to have worked.

The deal makes sense. Starck is one the very largest tantalum processors. Obtaining production data is close to impossible but industry sources suggest that, in terms of capacity for K-salt, tantalum powder and ingot, the company ranks second only to GAM and is well-ahead of Ningxia Orient. It has production facilities in Germany, Thailand and Japan and supplies tantalum powders for capacitors, sputtering targets and metallurgical uses, as well oxides, chemicals and alloy additives. JXNMM is a major producer of tantalum sputtering targets, possibly the largest. Its supply of tantalum comes from Tokyo Denkai, which receives tantalum powder from Starck and converts it to ingot.

The move seems to be a straightforward piece of vertical integration on the part of JXNMM. It is similar, although inverted, to the 2011 acquisition of Cabot’s tantalum processing business by GAM, which was then still more of a tantalum concentrate supplier. Interestingly, AMG is rumoured to have also been looking to acquire the business from Starck. That would also have been a logical step. With the cancellation of the long-term contract with GAM last year, Starck is now the principal customer for tantalum concentrate produced at AMG’s MIBRA mine.

It is important to recognise that the sale to JXNMM does not represent the entirety of Starck’s tantalum and niobium business. Another unit, H.C. Starck Inc., supplies tantalum and niobium (and other) fabricated products from operations in the USA, Germany and China.