ITOCHU Corporation (headquartered in Minato-ku, Tokyo; Yoshihisa Suzuki, President & COO; hereinafter “ITOCHU”) announced today that it has agreed to the sale of 51% of its shares in CIPA Lumber Co., Ltd., a manufacturer of veneer in British Columbia, Canada (hereinafter CIPA), and PACIFIC WOODTECH CORPORATION (hereinafter PWT), a manufacturer of LVL (Laminated Veneer Lumber) in Washington, USA, both consolidated subsidiaries of the ITOCHU Group, to Daiken Corporation (headquartered in Nanto, Toyama; Masanori Okuda, Representative Director President; hereinafter “DAIKEN”).

DAIKEN is a leading manufacturer of residential housing materials in Japan. In 2015, the company formulated a long-term vision for its business, declaring that it will explore possibilities for cultivating and expanding its existing businesses while creating new markets with the aim of transforming from a housing material manufacturer into an all-embracing company for building materials. In September 2018, ITOCHU concluded a capital and business alliance aimed at strengthening DAIKEN’s raw materials and building materials business abroad as well as other businesses in Japan and abroad, in order to achieve significant growth in its General Products & Realty segment. One of the collaborative themes of the capital and business alliance is "Expansion of wooden materials business." Specifically, to date we have discussed the joint promotion of marketing and research and development towards the development of new materials business abroad, and the implementation of a shared policy of proactive investment promotion.

ITOCHU established CIPA, which is targeted for this latest sale of shares, in its wooden materials business in North America as a joint venture in 1968, later acquiring the veneer business. In 1998, ITOCHU established PWT, which manufactures LVL. This enabled ITOCHU to effectively utilize veneers manufactured by CIPA to expand business in North America. This latest joint business development in the North American market has emerged from discussions on the capital business alliance, since ITOCHU's policy of strengthening manufacturing and development in order to increase profits through the further business expansion and improved productivity of CIPA and PWT dovetails with DAIKEN’s policy of expanding overseas business by capturing the world’s largest wood frame housing market of North America, and of acquiring the new commodity LVL.

ITOCHU will proactively develop joint business with DAIKEN in the North American market, which is expected to see stable growth in the future.