Clariant AG announced Jan. 26 an agreement to form a joint venture to sell masterbatch and engineered compounds in South Korea and Japan.
The deal is with Sang Ho Mercantile Co. Ltd., a major South Korean plastics compounder and masterbatch supplier headquartered in Yangsan, South Korea.
Clariant will own 55 percent of the venture, which will retain the name Sang Ho Mercantile. Terms were not disclosed.
Sang Ho reported 1998 sales of around $13 million and employs 130. The company is jointly owned by Jong Seung Lee and two Japanese companies: Asahi Kako Co. Ltd. and Tokyo Printing Mfg. Co. Ltd.
``The creation of this joint venture will establish a strong market presence for masterbatches and engineered compounds in South Korea and Japan, which are the No. 2 and No. 1 plastics markets, respectively, in Asia,'' Clariant said in a news release.
Clariant's Masterbatches Division is based in Easton, Md., but plans to relocate to Switzerland later this year. The unit reported worldwide sales of $700 million in 1997. It already has 12 facilities in eight countries throughout the Asia-Pacific region.
The joint venture will expand Sang Ho's existing capabilities, which focus on colored automotive compounds in Korea and masterbatches for the Japanese market.
The company also plans to grow the masterbatch business in polypropylene, polystyrene/ABS and engineering polymers, as well as specialty PET/polyamide masterbatches for film and sheet customers.
Does the fumbling Asian economy have anything to do with the timing of this joint venture? Clariant Senior Vice President Michael Smith said no, adding that Clariant, ``like the rest of the world, sees that Asian markets will recover.''
Smith said Clariant ``brings to them [Sang Ho] technology, and they bring to us presence in the [Asian] market.''
Clariant's corporate headquarters is in Muttenz, Switzerland.