New firm to produce peroxides

JAKARTA (JP): Sinar Mas Group, through its holding company PT Sinar Mas Tunggal, has established a new joint venture company with NOF Corporation and Marubeni Corporation, both of Japan, for the production and sale of organic peroxides in Indonesia.

The group said in a statement yesterday that the joint venture company, named PT NOF Mas Chemical Industries, will construct an organic peroxide plant with an annual production capacity of 4,000 metric tons in Bekasi, West Java, at a cost of US$37 million,

The new joint venture is 55 percent owned by NOF Corporation, 15 percent by Marubeni Corporation and 30 percent by Sinar Mas Group.

The statement said that out of the cost, $13 million will be financed with the company's equity and the remaining $24 million with loans.

The new venture company will start constructing the plant by November and begin operating it by the middle of 1997, the statement said.

The organic peroxides to be produced by the new company will include various kinds of polymerization initiators which are used for the production of PVC, LDPE, PS and dicumylperoxide (DCP) for synthetic rubbers, EVA and LDPE.

Sinar Mas Group is a Jakarta-based conglomerate controlled by Eka Tjipta Widjaja, which concentrates its operations in real estate and financial services, as well as having interest in pulp and paper, plantations and vegetable oil refineries.

The statement mentioned that Indonesia has been chosen as the site for the new chemical company due to its strategic location and healthy foreign investment incentives.

Furthermore, the Asian market, particularly the ASEAN countries and China, have shown huge potential for sales growth.

Besides Indonesia, the Association of Southeast Asian Nations (ASEAN) also groups Brunei, Malaysia, the Philippines, Singapore, Thailand and Vietnam.

In Japan, NOF is a leading producer of organic peroxide with a market share of 50 percent, while the company's market share in the world is estimated at 15 percent to 20 percent. (31)