TOKYO, Apr 07 (Pulse News Wire) – PATH Corporation (3840.T) announced today that it has decided to cancel the acquisition of a biomass power plant and further delay the commencement of its new business. Originally scheduled for purchase in May 2025, the deal was terminated due to geopolitical challenges affecting component procurement.
The company had entered into a sales agreement with Cyclical Resources Holdings Co., Ltd. for a zero-emission detonation system biomass power facility valued at approximately ¥720 million (including tax). However, difficulties arose in securing necessary components such as samarium cobalt magnets due to China's export restrictions on rare earth materials. As a result, the delivery date set for June 2026 could not be met, leading to mutual agreement to terminate the contract and return previously paid deposits totaling approximately ¥484 million. In light of this cancellation, PATH Corporation has postponed the launch of its planned new business until an unspecified future date while reassessing its plans.
Despite this setback, the company maintains its technical support and exclusive distribution rights for advanced biomass power generation technologies through its partnership with Cyclical Resources Holdings Co., Ltd. Moving forward, PATH will explore alternative designs and supply chain solutions to mitigate material sourcing risks. This decision is expected to improve the company’s cash flow. Additionally, since the biomass power project was excluded from the fiscal year ending March 2026 consolidated earnings forecast, the impact on the upcoming quarter's performance remains minor. PATH Corporation will continue to monitor developments and disclose any significant updates as appropriate.
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