- Expands into South America’s largest economy
- Strengthens IVL’s global footprint
- Confirms IVL’s commitment to Brazil
Bangkok, Thailand – 2 November 2018 – Indorama Ventures Public Company Limited (IVL), a global chemical producer, has announced that it has entered into an agreement to acquire M&G Fibras Brasil, in Cabo de Santo Agostinho, Brazil. The Cabo plant manufactures and supplies Polyester Staple Fiber, with total polymerization capacity of 75,000 tonnes/annum.
The transaction is expected to be completed in the fourth quarter 2018, subject to regulatory approvals.
This acquisition fills an important gap in IVL’s global footprint in fibers by establishing capacity in South America’s largest economy, Brazil. It also offers IVL an opportunity to participate in the domestic market along with strategic and logistic advantages from established free trade agreements with other Latin America countries. The demand in Brazil is expected to grow in response to a recent recovery in consumption.
The plant is in close proximity to Indorama Ventures’ PET site and also the third party PTA site in Brazil. Further synergies will be realized by using a jointly located Sao Paolo commercial office. Having a local manufacturing base, IVL is also in an advantageous position to expand more into nonwoven applications which are growing strongly in Brazil, supported by the presence of global brands. As a world leader in the service of the hygiene sector, the presence of global brands will allow IVL to offer its customers an extensive portfolio of products to serve their needs. Brazil has a very innovative textile industry and its relatively high consumer purchasing power is driving the growth in nonwoven and filling fibers. IVL’s strategy is to continue to serve the growing needs of the existing customers of M&G as well as the needs of IVL’s global branded customers in this fast-growing economy and stay ahead of the curve in introducing quality products.
Commenting on the acquisition, Mr. Aloke Lohia, Group CEO of Indorama Ventures, said,
“Brazil, with its large spinning industry is a natural place for the textile industry to enjoy long-term growth due to its location and large population. We intend to support the local spinning industry with a commitment to supply high-quality fibers to blend with cotton and reduce dependence on imports.
In addition, IVL will also be able to support the local non-woven manufacturing industry by supplying specialized fibers produced with the know-how from our global manufacturing businesses. We look forward to the continued support of the Government of Brazil in developing a robust and self-reliant textile sector.”