The top world producer of cross-linked polyolefin block foam, Zotefoams plc, has agreed in principle to join forces with the leading manufacturer of roll polyolefin foam in a new global sales and marketing deal. The alliance with Sekisui Chemical Co. Ltd., due to take effect before June, will see Zotefoams' block foam products marketed alongside Sekisui's thin roll foams in Europe, Asia and North America.
Polyolefin foams are used in a wide range of markets including aerospace, automotive, sports equipment, medical devices, toys and packaging.
"Our new alliance will transform Zotefoams' ability to penetrate new markets around the world," including growing markets in Asia and Latin America, Andrew Gingell, Zotefoams' managing director, said in a news release.
It also improves the potential of Croydon, England-based Zotefoams' soon-to-open plant in Florence, Ky., home of its U.S. subsidiary, Zotefoams Inc.
Osaka, Japan-based Sekisui makes cross-linked roll material in the United States through the Lawrence, Mass.-based Voltek Division of Sekisui America Corp. Voltek makes Volara roll material and Minicel block foam at facilities in Lawrence and Coldwater, Mich.
Zotefoams Inc. and Voltek will coordinate marketing beginning in April. Zotefoams' $25 million plant in Florence is scheduled to start production in the first quarter of 2001.
Zotefoams plc announced the deal as it unveiled its 1999 financial results.
The company reported pretax profit of 5.8 million ($9.2 million), down from 8 million ($12.7 million) a year ago. Sales were reduced from 24.2 million ($38.6 million) in 1998 to 22.4 million ($35.7 million).
Chairman Bill Fairservice blamed the drops on the rising cost of raw materials along with a sharp fall in sales from the toy market.
Capital spending during the year totaled 2.7 million ($4.3 million), most of which was invested in a new autoclave at Zotefoams' Croydon plant and the purchase of and site preparation for the Florence plant.
Zotefoams also announced it has developed and tested new technology allowing the long-distance shipment of nitrogen-saturated polymer slabs.