Engineering resins maker Ticona is growing in Asia through a trio of deals announced Dec. 20. The most significant deal is Ticona's acquisition of a 50 percent share in Korea Engineering Plastics Co. Ltd. from Hyosung Corp. KEP, a 12-year-old joint venture between Hyosung, Mitsubishi Gas Chemicals Co. Ltd. and Mitsubishi Corp., is South Korea's largest acetal maker, producing 120 million pounds annually from its plant in Ulsan.
The acquisition of KEP allows Ticona, a division of Celanese AG of Frankfurt, Germany, to extend its position as the world's largest acetal maker. Ticona produces almost 360 million pounds of acetal each year at plants in Kelsterbach, Germany, and Bishop, Texas.
Terms of the purchase were not disclosed.
The investment "is a great opportunity for Ticona ... to strengthen its presence in the Asia-Pacific region," Ticona Chairman and Chief Executive Officer Ed Munoz said in a news release.
Ticona also will add 4.4 million pounds of Vectra-brand liquid crystal polymer capacity by late 2000 at the Fuji, Japan, site operated by Polyplastics Co. Ltd., a Tokyo-based joint venture between Ticona and Daicel Chemical Industries Ltd. of Tokyo. The plant's current annual capacity is 6.2 million pounds. Ticona also produces 7 million pounds of LCP each year at its plant in Shelby, N.C.
High growth in the personal computer market is spurring the LCP expansion, since the material is used frequently in electronic connectors found in most PCs. Connector demand in Asia Pacific is expected to grow 25 percent annually through 2002.
Polyplastics also is feeding into Ticona's acetal growth through a 66 million-pound-per-year plant set to open in Kuantan, Malaysia, in early 2000.
Ticona's third deal calls for the opening of Ticona Japan Ltd., a Tokyo-based business unit aimed at handling sales and marketing for the firm's GUR-brand ultrahigh-molecular-weight polyethylene and Topas-brand cyclo-olefin copolymers in Asia.
Ticona already controls about 40 percent of the region's market demand with annual sales of about 4.4 million pounds. Asian growth rates for UHMW PE in markets ranging from water purification to battery separation are expected to be 12 percent per year — roughly double the growth rate in Europe and the Americas.
Ticona ranks as the world's largest UHMW PE maker with about 160 million pounds of annual capacity.
Asian customers have shown interest in using Topas in food packaging, shrink film and other applications. Ticona's first commercial-scale COC plant is set to open in mid-2000 in Oberhausen, Germany, with an annual capacity of 66 million pounds.
Sales from Ticona accounted for $842 million of Celanese AG's $5.3 billion total in 1998.