Kolon Industries to Merge with Kolon Glotech's Automotive Materials & Components Business

▷ Strengthened expertise in material and component solutions to respond to rapidly changing market demands

▷ Gathering capabilities to develop customized materials to meet next-generation mobility needs

Kolon Industries (CEO & President Kim Young-beom) is strengthening its expertise in the automotive materials and components business to expand its growth in the global automotive market.

Kolon Industries held a board of directors meeting on the 23rd to approve the spin-off of the automotive materials and components business of its subsidiary, Kolon Glotech. Founded in 1987, Kolon Glotech is a comprehensive materials company that supplies automotive, daily use, as well as cutting-edge new materials. With production bases in Korea, China, and the Philippines, the company has established

strong sales channels in China and the U.S., the two leading automobile producers and consumers, and the rapidly growing Indian market, to supply products to global automakers and parts manufacturers.

The transaction will consist of the spin-off of Kolon Glotech's automotive materials and components business, which will be absorbed by Kolon Industries. Kolon Industries is the largest shareholder of Kolon Glotech, holding 98 per cent of the company's shares, including treasury shares.

Upon completion of the merger in the first quarter of next year, Kolon Industries will have a competitive portfolio ranging from automotive interior materials to components, as well as the existing sales network of Kolon Glotech. According to Zion Market Research, the global automotive market is expected to grow at an annual rate of around 4 per cent (in terms of completed vehicles), reaching a market size of around KRW 530 trillion (USD 3.96 trillion) by 2030. In addition, given the rapidly growing demand for eco-friendly materials, as well as future eco-friendly vehicles such as electric and hydrogen vehicles, Kolon Industries with a competitive advantage in this field, is expected to capitalize on new growth opportunities.

As a leader in the domestic chemical industry since 1957, Kolon Industries has developed the highest level of chemical material technology that can satisfy any properties required for automotive interior materials, such as waterproof, soundproof, durable, and heat-resistant. Based on a wide range of recyclable materials and low-carbon products, Kolon Industries can provide eco-friendly solutions tailored to customers pursuing sustainability.

The merger will also provide Kolon Industries with a sales network covering major global markets including Korea, the US, China, India, Europe, Latin America, and the UK. Airbags, one of Kolon Industries' key automotive products, are expected to expand exports through Kolon Glotech's sales network in India, while Shamood, a high-quality artificial leather that is becoming popular in the luxury automotive sector, is also expected to gain traction through expanded access to customers in North America.

"The merger of Glotech's automotive materials and components business is aimed at strengthening our expertise in the automotive materials and components business to meet the rapidly changing market needs," said a representative from Kolon Industries. "We will continue to provide customized automotive materials and components solutions to meet the diverse needs of our customers and consolidate our position as a trusted partner.’