Bangkok, Thailand – Indorama Ventures Public Company Limited (IVL), a global chemical producer, has announced that it has entered into an agreement to acquire DuraFiber Technologies México Operations, S. A. DE C. V. (DFT), a leading Mexican producer of durable technical textiles for industrial, tire reinforcement, and specialty applications globally. DFT’s Queretaro plant in Mexico (co-sited with IVL Mexico) has a capacity to produce a total of 37,500 tonnes/ annum of PET High Modulus Low Shrinkage (PET HMLS), PET Heavy Denier Industrial (PET HDI) and Nylon 6 fully-integrated into tire cord fabrics and industrial and industrial textiles. Its products are used in a wide range of applications including reinforcement for conveyor belts, hoses, single-ply roofing, tents, automotive airbags, seat belts, safety harnesses and ropes. The transaction is expected to be completed in the third quarter of 2017, subject to the usual regulatory approvals (including the approval by the Mexican Antitrust Commission). Concurrently with this planned acquisition in Mexico, IVL has agreed to also acquire DuraFiber Longlaville, France having a capacity of 35,000 tonnes/annum, again subject to a definitive agreement, the relevant regulatory approvals and employee approval.
- Complementary addition to IVL’s Automotive Segment, further strengthening its leading position in US$ 10 billion+ automotive fiber market.
- A complete portfolio of tire cord fabric products makes IVL theleading fiber partner for the automotive industry.
- Gains significant presence in Mexico (Americas) and European markets.
- Synergies across product lines and marketsin IVL core business and site integration with IVL Mexico.
- Delivers immediate value accretion.
Commenting on the acquisition, Mr. Aloke Lohia, Group CEO of Indorama Ventures, said,“The acquisition of DuraFiber is strongly aligned with our strategy of pursuing accretive growth opportunities in the high value-added automotive segment. DuraFiber’s portfolio is a complementary fit with our current HVA tire cord fabric products in Europe and a strong fit with our existing PET site in Mexico. DuraFiber is a strong brand with recognized products with deep insights into the market combined with IVL’s global scale will enable us to better meet customers’ evolving needs.”
The market is projected to have a growth rate around 6% CAGR in 2017-2021. DuraFiber is the sole domestic tire cord fabric producer in Mexico with products approved by major global tire companies.
“The automotive segment is a key growth driver in IVL’s HVA portfolio that will bring exciting developments to the Company. While PET is still an important backbone for the Company, HVA is now accounting for 50% of IVL’s core EBITDA. Our focus remains on delivering best-in-class propositions, while driving our global innovation agenda to strengthen the Company’s capabilities in the value chain where we are present. I am confident that with the transformation strategy to consolidate our leadership position in key businesses and markets, IVL delivers significant value to our shareholders,” Mr. Lohia concluded.
Source: Indorama Ventures