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AkzoNobel Adds, Subtracts in China

Wednesday, March 27, 2013

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AkzoNobel has announced plans to invest an additional €65 million ($84.4 million U.S.) in China, to boost capacity and “improve operational excellence” at its Surface Chemistry plants in Boxing and Ningbo.

At the same time, however, the paint, coatings and specialty chemical giant will exit one of its businesses in the country, laying off about 200 workers in Boxing.

More than half of the new investment will go into AkzoNobel's facility in Shandong province, which the company took over in the acquisition of Boxing Oleochemicals in January 2012.

Photos: AkzoNobel

AkzoNobel's Surface Chemistry business manufactures products for paints, coatings, pigments, inks, polymers, resins and other applications.

The additional investment will be used to build a multipurpose reactor to expand local production capacity for amines and to "align HSE practices at the site with the rest of AkzoNobel," the company said.

In Ningbo, AkzoNobel will build a new alkoxylation unit, bringing the total investment at the multi-site close to €400 million ($518 million U.S.).

AkzoNobel's Surface Chemistry business manufactures products for paints, coatings, pigments, inks, polymers, resins and other applications.

Increasing Asian Demand

"There is increasing demand for our specialty surfactant products across Asia, and investing in Shandong province will ensure that we provide a strong local manufacturing operation in order to support our customers as they themselves continue to grow," said Werner Fuhrmann, AkzoNobel's Executive Committee member responsible for Specialty Chemicals.

"Ningbo also remains fundamental to our growth ambitions in the region and has a crucial role to play as we continue to expand."


AkzoNobel will make improvements to health, safety and environmental conditions in its China plant, said Managing Director Bob Margevich.

The health, safety and environmental upgrades in Shandong are just as important, said Bob Margevich, managing director of AkzoNobel's Surface Chemistry business.

"It's also crucial that we maintain stringent HSE standards at all our sites, so we are taking all the necessary steps to ensure the best possible working environment for our employees." Margevich said.

No details on those improvements were released.

Layoffs Planned

As it invests in one end of its business, AkzoNobel will exit another. The company said it would shutter its merchant fatty acid business in Boxing, closing down two of three fatty acid plants and laying off about 200 employees at the site.

AkzoNobel's Surface Chemistry business is a global supplier of specialty surfactants, synthetic and bio-polymer additives, and specialty polymers. These products are used as formulation ingredients and process aids in many applications, ranging from home and personal care to asphalt road paving.

AkzoNobel currently employs more than 7,000 people in China, with 2012 revenue totaling €1.7 billion ($2.2 billion U.S.), most of it generated by local demand.


Tagged categories: AkzoNobel; Coatings raw materials manufacturers; Labor; Market share; Supply and demand

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