Low & Bonar made joint venture with Alujain Corporation for manufacturing Geotextiles
February 11, 2011 - United Kingdom
Low & Bonar PLC ("L&B" or the "Group"), the international performance materials group, and National Petrochemical Industrial Company ("NATPET"), a subsidiary of Alujain Corporation ("Alujain"), today announce that they have agreed the terms on which they are to establish a joint venture company in Saudi Arabia for the design, manufacture and sale of geotextile products for the fast growing civil engineering markets in the Middle East and the Indian subcontinent.
The joint venture company will build a new manufacturing plant at a site near to NATPET's polypropylene production facility in Yanbu, in western Saudi Arabia, and will benefit from a long term supply agreement with NATPET.
L&B will have a 50% equity interest in and shared operational control of the venture with NATPET. Each partner's committed contribution to the venture will be SAR32 million (approximately £5.4 million), payable in cash during 2011, with L&B's contribution being funded from its existing resources. The venture is expected to be earnings enhancing for L&B in 2013, in its first full year of operation.
Alujain is a public company in Saudi Arabia with a substantial stake held by Xenel Industries, a diversified industrial holding company based in Jeddah. Alujain leverages Saudi Arabia's significant hydrocarbon resources in developing world-scale energy intensive industries.
The joint venture arrangements are subject to obtaining standard licenses required to conduct business in Saudi Arabia, which are expected to be obtained by mid 2011.
Steve Good, Group Chief Executive of L&B, commented: "We are delighted to be partnering with such a well respected Saudi Arabian company. The joint venture is well positioned to take full advantage of the high growth geotextile markets in the Middle East and the Indian subcontinent given its unparalleled technological, marketing and raw material strength. The venture increases the Group's presence in fast growing emerging markets and is a further step in our development as a global performance materials group."
Marwan Nusair, President, Alujain, commented: "The geotextiles joint venture is our first downstream venture under NATPET with a view to developing value-added products, creating employment opportunities for Saudis and bringing new technology to the Kingdom. We are proud to have joined hands with a leading player in the geotextiles business."
The joint venture company will build a new manufacturing plant at a site near to NATPET's polypropylene production facility in Yanbu, in western Saudi Arabia, and will benefit from a long term supply agreement with NATPET.
L&B will have a 50% equity interest in and shared operational control of the venture with NATPET. Each partner's committed contribution to the venture will be SAR32 million (approximately £5.4 million), payable in cash during 2011, with L&B's contribution being funded from its existing resources. The venture is expected to be earnings enhancing for L&B in 2013, in its first full year of operation.
Alujain is a public company in Saudi Arabia with a substantial stake held by Xenel Industries, a diversified industrial holding company based in Jeddah. Alujain leverages Saudi Arabia's significant hydrocarbon resources in developing world-scale energy intensive industries.
The joint venture arrangements are subject to obtaining standard licenses required to conduct business in Saudi Arabia, which are expected to be obtained by mid 2011.
Steve Good, Group Chief Executive of L&B, commented: "We are delighted to be partnering with such a well respected Saudi Arabian company. The joint venture is well positioned to take full advantage of the high growth geotextile markets in the Middle East and the Indian subcontinent given its unparalleled technological, marketing and raw material strength. The venture increases the Group's presence in fast growing emerging markets and is a further step in our development as a global performance materials group."
Marwan Nusair, President, Alujain, commented: "The geotextiles joint venture is our first downstream venture under NATPET with a view to developing value-added products, creating employment opportunities for Saudis and bringing new technology to the Kingdom. We are proud to have joined hands with a leading player in the geotextiles business."