|Indorama announces acquisition of DuraFibers plants in Mexico and France: Read the press release here…|
|AKC Note: As anticipated (see Carmichael Report July 27) Indorama is now confirming the acquisition of the DuraFibers plant in Queretaro Mexico with both polyester and nylon high tenacity yarn capacity as well as tire cord capacity. Additionally Indorama is acquiring the DuraFibers plant in Longlaville France for polyester high tenacity yarn mainly targeted at tire and auto applications. It seems that the future of the remaining DuraFiber yarn plants (Salisbury, Shelby and Bad Hersfeld) is unlikely to be with Indorama, we will have to see if any other buyer arrangement is forthcoming. We do not hear of much buying enthusiasm for the 2 US plants, but a late move cannot be ruled out. Based on the advice that was sent to customers, DuraFiber will close these facilities on Sept 11th although we understand they have had a surge in orders for customer inventory build and may not be able to complete all by this date.
Indorama clearly sees the automotive industry as a major part of its forward growth strategy and we do wonder if some further investment in tire conversion may be in the future.
We also think it is likely that the previously announced investment in polyester high tenacity capacity by the Indorama owned PHP in Scottsboro AL will be expanded to meet the needs of the domestic technical fabric industry following the likely closure of DuraFiber Salisbury. There are major concerns in the industry over the survival of the Berry Amendment rulings for various fabric and finished products for the US military without a US polyester high tenacity supplier and we think that PHP will be aiming to fill that void.
Times continue to be interesting!