- Extends complementary capabilities of Indorama Ventures and Huvis to deliver customer value proposition and accelerate profitable growth
- Builds position as one of leaders in Low Melting Fiber (LMF) in low tax environment in the U.S.A.
- Strengthens both Huvis’s and Indorama Ventures’ business portfolio and enhances competitive position in key industry verticals with a strong platform for future growth
- Brings significant synergy and cost savings benefits
- Joint venture schedule to start in 2018, and will be operational in 2019
Bangkok, Thailand – 16 January 2018 – Indorama Ventures Public Company Limited (IVL), a global chemical producer, and Huvis Corporation (HC) of South Korea announced their intention to establish a 50:50 joint venture for the development, construction and operation of a Low Melting Fiber (LMF) plant in the US. The location is being finalized and the joint venture is expected to be established in 2018, and will be operational in 2019, subject to various agreements and regulatory approvals as may be applicable.
The new state-of-the-art plant will manufacture Low Melting Fiber (LMF), with an annual capacity of 60,000 tonnes. LMF is commonly used as a binder fiber in core-sheath constructions to produce HVA applications for automotive and industrial composites, such as wadding, insulation, filtration, automotive acoustic insulation material and other products where heat is used to bond the fibers. The initial volumes of LMF will be sold in the U.S.A, with its new low tax environment and the potential to significantly expand its scope into neighboring regions over time. LMF sales are expanding at a rate of 8% a year as manufacturers have been converting from conventional chemical adhesives to a thermo-bonding method.
The decision to form a joint venture builds upon Indorama Ventures’ successful feedstock integration strategy and a continued focus on expanding High Value-added (HVA) portfolio. The JV will leverage Huvis’s best-of-breed technology and its strong customer base in the region as well as Indorama Ventures’ global management capabilities and its strong manufacturing and cost position. With this joint venture, both companies will be able to offer the best value to customers through depth and scale using the new company’s combined capabilities and expertise. Customers will be assured of better security of supply and excellent service.
Commenting on this collaboration, Mr. Aloke Lohia, Group CEO of Indorama Ventures said, “We are delighted to have the opportunity to partner with Huvis, and looking forward to further develop a strong relationship. Our partnership will be a strategic step for both Indorama Ventures and Huvis to emerge as a regional leader and position us well to take advantage of the robust growth potential in the region. This is an exceptional opportunity for both companies to provide unique value for customers, and bring new exciting fibers and composites solutions to market.”
Mr. Shin, You Dong, CEO of Huvis said, “We are so pleased to work with Indorama Ventures to build stronger market presence in North America, one of our core markets for LMF business. As one of leaders in LMF, we are pursuing “Glocalization strategy” to better serve our key customers’ needs based on more efficient and cost-competitive platform. We will continue to collaborate and extend our relationship with Indorama Ventures to seek more synergies in other interesting polyester fiber markets with strong growth potential.”
About Huvis Corporation
HUVIS CORPORATION, a Korea-based joint venture between SK Chemicals and Samyang Corporation, is one of the world’s leading polyester fibers producers. The Company is focusing on differentiated, specialty polyester fibers and is well-known for its best-in-class technology leadership in specialty conjugate fibers such as Low Melting Fibers market where it has been holding global No.1 market share for decades. The Company's product portfolio includes staple fibers (SFs), filament yarns (FYs) and super fibers (e.g., Aramid, PPS, etc.) as well as polyester chips used in polyethylene (PET) materials, bottles and films. Its SFs include spinning fibers and non-woven fibers, which are used for various industrial applications in automotive, construction, furniture and hygiene industries. The Company has production bases in Korea and China, and its consolidated revenue is US$1.2 billion in 2017.
For investors and media: