IRVINE, CALIF. - Guangzhou Rodman Plastics Co. Ltd. has placed a $2.3 million order for six Mitsubishi Heavy Industries injection molding machines, with a stipulation the equipment be delivered by Dec. 31. We had a desire to get product from Cincinnati Milacron, but they couldn't meet [our deadline] on the big machine,'' Rodney Bell, chairman of the joint venture in Guangzhou, China, said in an Aug. 12 interview in the Irvine office of its business-development adviser, Global Capital Markets Inc.
In its July 12 purchase order, the venture opted to buy two machines with clamping forces of 650 tons and two of 850 tons, for delivery by Oct. 31.
Mitsubishi, based in Nagoya, Japan, must deliver the larger machines, with clamping forces of 1,300 and 2,500 tons, this year to allow the venture not to incur a 35 percent import duty that went into effect for foreign joint ventures at the beginning of 1996.
They've given a one-year holiday for those joint ventures approved prior to the end of 1995,'' Bell said.
China approved Guangzhou Rodman Plastics on Nov. 6, beating the deadline by two months.
Bell said the venture employs 511, had pro forma 1995 profit of $2.6 million on sales of $20.5 million and operates 27 injection molding machines with clamping forces of 3-1,000 tons.
The venture has embarked on in-country and export projects involving industrial pallets, trash cans on wheels, heavy-duty aprons, bathroom fixtures, gardening equipment and upscale outdoor furniture. About $14.5 million of the sales were from the factory, with the remainder through five retail stores.
The butcher aprons fulfill Australian and New Zealand laws that ban the use of cotton coverings in the food industry because they retain bacteria. Guangzhou Rodman Plastics makes the aprons of 0.35-millimeter PVC and sells them wholesale for less than $2.
Financing arrangements materialized in Canada. Bell said the venture expects its stock to begin trading by Oct. 31 on the Alberta Stock Exchange in Calgary. Yorktown Securities in Calgary will handle the initial public offering.
The venture raised about US$1.2 million in an initial round of financing in Canada, the United States and Hong Kong in May and, to pay for the molding machines, seeks $2.3 million in a secondary round now.
Investment firm Pearl River Plastics Ltd. of Hong Kong, incorporated in the British Virgin Islands, owns 64 percent of Guangzhou Rodman. A Guang-zhou municipal agency owns 28.3 percent; a cooperative, 4.9 percent; and employees, 2.8 percent.