FT EnE, looking to enter Chinese filter market
Finetex ㅣ 2017-06-12 ㅣ 653
To form a Joint Venture with a local Chinese filter company
Aiming to start production from this Aug...
An announcement has been made by FT EnE that it has signed an agreement with the Chinese automotive filter company, Yili, for production and marketing filters in China
Yili was established in 1998. The firm is currently manufacturing and distributes various types of automobile filters to automakers across more than 60 countries. The headquarter is located in Qinghe, Hebei China. Currently, Yili owns and operates two R&D centers and seven manufacturing plants.
In this JV, it is agreed that FT EnE will hold 55% stake with 60% appointment right for board of directors and the rest will be held by its partner. In other words, FT EnE will take the control stake and the company’s investment will be made in the kind of electro-spinning line which is agreed at the value of US$ 5 mil per line.
Yili has guaranteed sales of US$ 9 mil, $ 18 mil, and $ 25 mil during each year for the first 3 years. With this JV, Yili’s plan is to adopt nanofiber on its automobile filters first, and then expand its nanofiber product lines in accordance with capacity increase.
FT EnE has already completed the nanofiber electrospinning unit and it is scheduled to be sent to the China when testing completes in FT EnE’s new plant at Hwasung, Gyeongi Province of Korea. First formal operation in China is expected to start from coming August.
FT EnE’s spokesman said the deal was signed by FT EnE Canada, a 100% owned subsidiary of FT EnE. On-going uneasy relationships between Korea and China over THADD issue had partly led FT EnE Canada to sign the deal instead of its parent company in Korea. The spokesman added, however, that the business results of this JV will be reflected on parent company’s financial statement on consolidated basis.