Texmaco, Hoechst plan textile fiber plant

Texmaco, Hoechst plan textile fiber plant

FRANKFURT (Reuter): German chemical group Hoechst AG said yesterday it planned to set up a textile fiber plant with Multikarma Investama of Indonesia's Texmaco Group aimed at boosting Hoechst's European textile fiber business.

Hoechst said it had signed a letter of intent founding the venture which will give Hoechst a 40 percent stake in the joint company and Multikarsa a 60 percent stake.

The new company will be based in Germany, Hoechst said in a compulsory statement, and its name will be decided later.

Hoechst said it will transfer its European textile polyester filament and staple fiber business, along with the trademark Trevira to a joint venture with Multikarska Investment of Jakarta, Hoechst said.

Multikarska is a holding company, which owns the Texmaco Group, which in turn has activities in polyester and polyester raw materials, textile technology and textile industry, financial services and other areas.

Hoechst plans to transfer a number of units, which will now form part of the joint venture, including Ernst Michalke in Frankfurt and its site in Guben; Kaj Neckelmann and its Denmark site; Hoechst Fibras in Portugal and parts of the Bobingen site of Hoechst Trevira in Germany.

"In view of the significant structural changes in the European fiber industry, the decision to set up a partnership is both forward-looking and logical," said Bill Harris, president and CEO of Trevira's worldwide business.

In Jakarta Texmaco Group's Chairman Marimutu Sinivasan said yesterday there were many opportunities in today's polyester industry for a large, vertically-integrated producer like Texmaco.

"Our strategy is to build a global polyester business through continued investment and strong technology and marketing alliances," Sinivasan said.

He added Texmaco, already operating in the U.S., United Kingdom, Ireland and Eastern Europe, North and South Africa and Singapore, would bolster its position among the leading polyester producers in the world.

Sinivasan saw Texmaco's partnership with Hoechst as a tremendous way to access the European market.

Hoechst polyester staple and filament yarn business is the largest in Europe with an annual capacity of 180,000 tons and a 20 percent share of the European market.