US chemical giant Huntsman Corp to boost China investment
Source: Chinadaily Date: 2006-08-24
US chemical giant Huntsman Corp will step up its investment in China in order to tap into strong domestic demand in the world's largest market for textile effects chemicals.
Peter Huntsman, the company's president and chief executive officer, made the remarks at yesterday's inauguration of Huntsman Textile Effects (China), in Guangzhou, southern China's Guangdong Province.
The new firm was the result of Huntsman's acquisition of the global textile effects business of Ciba Specialty Chemicals Holding Inc for US$253 million, which was completed last month.
New York-listed Huntsman has so far invested US$1 billion in China, including the acquisition of Ciba's China-based textile effects operations.
Huntsman also has a one-third share in a US$1 billion Shanghai chemical plant that mainly produces polyurethane. The project, which also has investment from BASF and Chinese partners, will become operational today, supplying the shoemaking, automobile and electrical appliance industries.
The company's sales in China, which grew from zero in 1978 to US$1 million in 1996, are expected to top US$2 billion this year, said Huntsman.
He predicted that China's market for textile effects chemicals will grow by 7 to 10 per cent annually in the coming years and that Huntsman's sales of those products in the country will increase twice as fast.
Textile effects chemicals enrich the performance of textile products, enhancing their colour, reducing creasing and allowing the fabric to breathe.
Huntsman said he expected China's chemicals market to grow at an annual rate of 10 to 15 per cent, adding that his firm will develop its production capacity in China in order to meet this demand, Huntsman said.
China is the world's largest market for textile effects chemicals, and Huntsman will expand the capacity of its Guangzhou plant by 30 to 50 per cent annually over the next two to three years.
Domestic sales of Huntsman's textile effects products made in China are set to outstrip its exports in the future, said William Yau, vice-president of Huntsman Textile Effects Asia Pacific.
Huntsman, which has acquired 35 companies in the past 25 years and generated revenue of US$13 billion last year, will seek more opportunities for acquisitions, especially in Asia, Huntsman said.
