Amoco Fabrics and Fibers Co. of Atlanta, producer of polypropylene fabrics and fiber products, has acquired two Mexican plants that make woven PP material, sack and industrial packaging. The company, part of the giant oil and petrochemicals group Amoco Corp. of Chicago, bought the assets of Bemis Craftil SA de CV and Nitram SA of Matehuala, Mexico, from the De Alba family. Terms of the agreement were not released.
This acquisition will allow Amoco Fabrics and Fibers, which has been selling limited amounts of PP carpet backing from the United States to Mexico, to produce the material locally. The acquisition also will enable it to enter new Mexican markets and export some products into the United States, said Jim Spangler, Amoco spokesman.
The deal, inked by the Atlanta firm's Mexican subsidiary Amoco Fabrics & Fibers de Mexico, represents Amoco Corp.'s first wholly owned operation in Mexico, though the firm has been doing business in Mexico for 20 years.
The Mexican plants make open-weave PP leno - a type of weave in which the warp yarns are paired and twisted - for produce bags, and knitted industrial fabrics including polyethylene fabrics and sewn bags for packaging products such as feed and seeds. They also make twisted paper fabrics, Amoco said.
The firm would not disclose the Mexican plants' capacity, production or employee turnover. However, the plants employ 950 and employees will continue working as usual during the takeover. Amoco also said the plants have been exporting to the United States in a limited way.
``The new [plants are] a good fit with our current operations within North America. It will add immediate new sales and it will open up new growth opportunities in Mexico and Central America,'' said Frank Andrusko, president of Amoco Fabrics and Fibers Co.
Referring to the takeover, Amoco Corp.'s Spangler explained: ``This is part of our business that we're looking to aggressively grow worldwide.''
He said Amoco plans to convert some of the Matehuala looms to produce carpet backing over the next year to serve what is currently a limited Mexican customer base.
Spangler said the deal would take Amoco into new markets in Mexico, for example leno fabric, so far not produced by the group in North America.
The deal ``reinforces our belief the long-term outlook for the Mexican economy is brightening,'' said Luis Sierra, director general of Amoco Chemical de Mexico SA de CV, head of the group's Mexican operations.
Former Bemis Craftil director Antonio Martin de Alba Herran was unavailable for comment on the purchase of his family's plants.