Nov 24 2005
Umicore has signed an agreement to purchase all assets and business activities of Suzhou Alloy Material Factory Co. Ltd. (Suzhou Alloy). The company is a leading producer of precious-metals-containing contact materials in China. The purchase will enable Umicore to strengthen the global presence of its Technical Materials business and improve the ability of this business to serve the fast-growing Chinese market both directly and through its European and US customers.
Umicore has a leading position in the area of semi-finished materials for low and medium voltage contact materials applications in the electrical and relay industries. High quality silver tin oxide is presently not locally available in consistent quantities in China. Umicore is the world’s leading manufacturer of silver tin oxide and by extending its production base will be able to play an increasingly important role in the high-tech contact materials market in China.
After the closing of the transaction, which is scheduled for early February 2006, Umicore will become owner of the assets of Suzhou Alloy, which is currently in the process of relocating its activities to a greenfield site which will operate to the highest standards. The new factory, Umicore Technical Materials (China) Co., Ltd, will be located in the Suzhou New & Hi-Tech Industrial Development Zone (SND) located approximately 90km west of Shanghai. The relocation is expected to be completed by the end of February 2006.
The investment of approximately €7.5 million is expected to be earnings accretive within one year. Suzhou Alloy employs 170 people and in 2004 generated revenues of approximately RMB 100 million (€10m).