Kemira Forms Joint Venture with AKD Wax Producer TC Wanfeng in China
The joint venture, NewCo, will mainly produce AKD wax, which is a sizing chemical used in board and paper manufacturing to create resistance against liquid absorption.
Dec. 3, 2018 - Kemira said that it has received final authority permits and closed a deal to form a joint venture with AKD producer Shandong Tiancheng Wanfeng Chemical Technology ("TC Wanfeng") in China. The new JV, Kemira TC Wanfeng Chemicals Yanzhou, will be known as NewCo.
NewCo will mainly produce AKD wax and its key raw material fatty acid chloride (FACL). AKD wax is a sizing chemical used in board and paper manufacturing to create resistance against liquid absorption.
Kemira holds 80% of NewCo while TC Wanfeng holds 20%. Value of Kemira's share of the JV is about EUR 55 million. In addition, Kemira has an option to acquire TC Wanfeng's 20% in the coming years under pre-defined conditions.
“The joint venture is a good strategic fit, said Kim Poulsen, President, Pulp & Paper for Kemira. “We strengthen our position in the market with a quality asset and secure our supply of the key raw material for AKD wax. With the newly built site, we ensure our capacity utilization and support our customers better with our global delivery capability. At the same time, this enables us to grow even faster in APAC.”
NewCo's site is located in the same chemical park with Kemira's first AKD wax plant in Yanzhou, China and the proximity of the two sites results in operational synergies. The NewCo site also offers growth opportunities for other relevant chemicals, Kemira added.
In addition, NewCo will produce polyaluminum chloride (PAC) which is a coagulant for water treatment.
NewCo will start the production of chemicals in the second half of 2019 after necessary investments and the ramp-up phase are completed.
Kemira is a global chemicals company serving customers in water-intensive industries. To learn more about Kemira, please visit www.kemira.com.