South Korean Firm Establishes Polyester Chip Joint Venture in China

---

Researched by Industrial Info Resources (Sugar Land, Texas)--SK (South Korea), one of the world's top 500 companies, has established a joint venture with Zhejiang Zhenbang Fiber Corporation Limited (Zhengbang) in Ningbo City to produce bottle-grade polyester chips. The joint venture's annual production capacity is designed to reach 150,000 tons with sales volume totaling $227 million. The production line is expected to become operational after December 2008. The capacity is expected to expand to 400,000 tons with the annual sales volume amounting to $667 million by 2011. Half of the products will go toward foreign markets through SK's global sales network.

The registered capital of the joint venture totals $19.3 million, 54.4% by Zhengbang and 45.6% by SK. With the funds already transmitted, the companies are negotiating with suppliers to purchase Swiss equipment, which is believed to be the most advanced in manufacturing polyester chips.

The production line will be completed by upgrading a Zhengbang plant with the Swiss equipment. It is reported that through the upgrade, $20 million and 10 months of construction will be saved.

SK is involved in many industries, including energy, chemical and telecommunication. It has built several solely owned polyester chip plants in Poland and Indonesia. The plant in Ningbo, however, is SK's first joint venture to produce bottle-grade polyester chips.

Zhengbang is SK's largest consumer of pure terephthalic acid in China, demanding more than 10,000 tons of the product every month. Annual transactions between the partners can reach from $80 million to $100 million. Zhengbang was founded in 1990 and has two factories in Zhejiang and Shandong Province. The company employs about 2,000 people at the factories with an annual sales volume of $267 million. As one of China's 500 largest private enterprises, Zhengbang's total assets amount to $187 million.

Industrial Info Resources (IIR) is the leading marketing information services company for the industrial process, heavy manufacturing and energy-related markets throughout the world. For more than 24 years, IIR has provided accurate and timely intelligence through products such as plant and project information databases, focused market databases, industry forecasting, key industry contacts, industry and territorial map products, direct marketing services and applications, and daily industry news.