Showa Shell Splits out Lubes Business

Showa Shell Sekiyu K.K split its lubricants manufacturing and marketing operations into a wholly-owned subsidiary.

Established May 12 in an absorption-type company split, Shell Lubricants Japan K.K. will be responsible for Showa Shells manufacturing, storage, transport, sales, export and import of lubricants, according to a recent press release. The arm has capital of 310 million (U.S. $2.8 million) and is headed by Makoto Abe.

The subsidiary will help facilitate the maintenance and expansion of the current supply of products and services supplied to customers in Japan and overseas, the statement read.

Analysts say the split could help Showa Shell maintain focus on its lubes segment following its recent alliance with Idemitsu Kosan Co. Earlier this month, the two formed the Brighter Energy Alliance to gradually collaborate parts of their oil businesses such as crude oil purchasing and logistics planning. In December, Idemitsu Kosan purchased 31.26 percent of Showa Shell shares for 159 billion to become the latters largest single shareholder. Following the sale, Shell Group held 3.79 percent of shares.

Showa Shell did not disclose its lubricant segments turnover or sales volume in its 2016 report. However, in a February statement to shareholders, the firm said it had been redoubling efforts to market differentiated products that provide substantial added value.