Nov 30 2007
The Carbon Company – yesterday has signed definitive agreements to acquire Aldila Inc.’s interest in Carbon Fiber Technology LLC (CFT), Evanston (Wyoming), USA, a joint venture between SGL and Aldila. Since 1999, SGL Group and Aldila – the world’s leading producer of composite golf shafts – each held a 50 percent stake in the joint venture. The purchase price was agreed to be € 13 million. For SGL Group, this corresponds to less than an investment in a comparable greenfield plant, and bears the advantage of taking over an existing business and making use of a low cost and efficient infrastructure.
With an annual output of approx. 1,000 metric tons, the Evanston plant produces carbon fiber for a variety of applications, including wind power, automotive, engineering plastics and the recreation sector. The joint venture, which the Group had accounted for at equity to date, will henceforth be fully consolidated.
The acquisition of the joint venture is an integral part of the published growth strategy of SGL Group to expand the total production capacity for carbon fibers up to 12,000 metric tons by 2012. It is a key milestone in SGL Group’s intention to develop the Evanston plant into a major carbon fiber production site as a complement to the Company’s sites in Europe. With the acquisition of the Aldila stake, 100% owned production capacity will increase from 500 to 1,000 metric tons. As a next step, a second production line with an annual capacity of approx. 1,000 metric tons will be built. Project start is scheduled for beginning of December 2007, with full commercial production as of second quarter 2009. The Evanston plant is expected to continue to operate at capacity including its expansion due to long-term supply contracts with Aldila, as well as with other customers in the wind, engineering plastics, and other industries. Leveraging the existing infrastructure – together with its attractive cost position – the Company further intends to raise production capacity stepwise at Evanston to around 4,000 metric tons by 2012.
Dr. Hariolf Kottmann, member of SGL Group’s Board of Management, reiterated already-announced plans to “invest around € 300 million to participate in the growth market for carbon fiber,” and, “to increase SGL’s total production ca-pacity, up to 12,000 metric tons by 2012.” He cited the acquisition of Aldila’s stake and the production expansion at Evanston to 2,000 metric tons as a key milestone to become one of the leading carbon fiber producers operating in the US with a significant part of our midterm production capacity located in the US dollar area.”
In addition to the plans for the Evanston site, and the previously announced expansion of capacity in Inverness, Scotland to an annual production of approx. 4,000 metric tons by the end of 2008, SGL Group also plans to establish a new carbon fiber production unit with similar capacity in Meitingen, Germany. In implementing this growth strategy, the Group expects to increase sales revenues of its Business Unit Carbon Fibers & Composites (CFC) by considerably more than 15% p.a. between now and 2011.
Due to increasing substitution of traditional materials worldwide demand for carbon fiber of currently 30,000 metric tons p.a., is expected to double by 2012 with stable annual growth rates of approx. 15% p.a. Among the eight producers of carbon fibers worldwide, SGL Group is the only European producer.