Swiss pipe manufacturer Georg Fischer AG has won a big piece of China's growing gas- and water-distribution and auto-parts markets through its takeover of Australia's top gas pipe and fittings producer. The acquisition of Sydney, Australia-based Industrial Pipe Systems Co. Pty. Ltd. from Australian Gas Light Co. includes three plants in Australia, plus a joint venture in China with Ling Yun Machinery Factory Ltd.
According to Georg Fischer, the joint venture is China's largest extruder of polyethylene pipe for gas and water. The venture, named Chinaust Plastics Corp. Ltd., also makes plastic auto components and has three plants in China. IPS had owned 50 percent of the venture.
Georg Fischer is based in Schaffhausen, Switzerland. The company paid A$36.25 million (US$20.76 million) for IPS, which also makes nylon pipe, according to Australian Gas Light of North Sydney, Australia.
Meanwhile, a British press report claims Georg Fischer recently tried and failed in a bid to take over Glynwed International plc, the global leader in plastic pipe.
Glynwed of Birmingham, England, rejected Fischer's offer of up to 600 million ($894 million), according to London's Sunday Telegraph.
A Fischer spokesman would not confirm nor deny the report.
"As a rule, Fischer does not comment on its intentions in this kind of situation. We cannot comment on this story," he said. A Glynwed spokesman said there was "no truth" in the report and suggested the newspaper had misinterpreted a comment from Fischer.
Fischer's Asian deal includes IPS's three national gas distribution pipe plants in Mackay, Albury and Kingsgrove, Australia. The firm has 116 employees in Australia, plus 350 in its Chinese operations. IPS reported sales of US$85 million and profit of US$2.17 million in its 1999 fiscal year, according to Fischer and Australian Gas Light.
Fischer already runs a plant in Shanghai, China, that makes industrial and distribution pipe.
Bruno Meier, managing director of Georg Fischer Pte. Ltd. in Singapore, declined to give details about IPS's extrusion and injection molding operations in Australia and China.
In a news release, Fischer said market prospects in the pipe sector in Australia "are regarded as good," and China is an "attractive growth market" for gas and water pipe.