AkzoNobel plans to strengthen its position in specialty surfactants while enhancing its manufacturing footprint in Asia by acquiring Boxing Oleochemicals, Asia’s leading supplier of nitrile amines and derivatives.
Established in 1993 and based in Shandong Province, Boxing had revenues of approximately €100 million (about $142 million US) in 2010. Its activities will be integrated into AkzoNobel's Surface Chemistry business, a global supplier of specialty surfactants, synthetic and bio-polymers additives used as formulation ingredients and process aids in a variety of applications.
Demand in Asia for amines and derivatives is being driven by population growth, an expanding middle class, an increased focus on sustainability and the build-up of infrastructure, notably in China and India, according to AkzoNobel.
Accelerating Growth, Local Production
"This is an excellent opportunity which couples our strategic ambition to accelerate growth in Asia with our commitment to locate production closer to our customers," said Rob Frohn, AkzoNobel's Executive Committee member responsible for Specialty Chemicals.
"Boxing's leading market position in amines will complement AkzoNobel's growing specialty surfactant business in Asia. The acquisition will also provide a strong local manufacturing operation in the region."
Bob Margevich, Managing Director of AkzoNobel Surface Chemistry, said demand for amines and derivatives was “expected to increase significantly over the next few years, with a third of the Asian demand for amines coming from China alone.”
“We plan to enhance the process capabilities and increase capacity at the Shandong site by introducing our state-of-the-art manufacturing technology. We will also introduce new products to the marketplace based on AkzoNobel's product and application knowhow."
The completion of the transaction is subject to closing conditions, including the approval of the Chinese authorities. It is expected to be finalized in the last quarter of 2011.
AkzoNobel currently employs over 6,700 people in China, with 2010 revenue totaling €1.3 billion (about $1.8 billion US), most of it from local demand. The company's ambition is to achieve revenue of $3 billion in China by 2015.