Indorama Ventures focusing on Indonesia
Indorama Ventures (IVL), the world's leading integrated polyester-chain manufacturer, expects its recent acquisition of PT SK Keris and PT KS Fibre will double the Indonesian contribution to its revenue to 10 per cent.
IVL’s revenue this year is projected to reach US$8 billion (Bt246.88 billion).
“Indonesia is the next China and India. Besides Thailand, our focus in Southeast Asia is Indonesia, and we expect to invest more in the country,” group chief executive officer Aloke Lohia said recently.
He said IVL expects to generate revenue of $8 billion this year, of which 10 per cent will be contributed from Indonesia, up from 5 per cent last year. The doubled contribution is attributed to last year’s acquisition of PT SK Keris and PT KS Fibre, which manufacture yarn, polyester and polyethylene terephthalate (PET).
IVL acquired both companies from SK Syntec, a subsidiary of South Korea-based SK Chemicals. PT SK Keris has been renamed PT Indorama Ventures Indonesia, while SK Syntec has become PT Indorama Polyester Industries. The former has production capacity of PET, polyester and yarn of 160,000 tonnes per annum, and the latter has fibre and polyester capacity of 36,000 tonnes per year.
Lohia said PT Indorama Ventures Indonesia is increasing its capacity to produce polyester by 300,000 tonnes per annum at an investment cost of $200 million.
“We will not stop looking for new projects in Indonesia,” he said.
Indonesia is one of the biggest markets for textiles. In 2012, the country expects to export textiles worth $13 billion. The Indonesia Textile Association forecasts that demand in the domestic market will grow rapidly to account for 50 per cent of output this year from 40 per cent in 2011.
IVL recently announced it would acquire a 100-per-cent stake in Old World Industries 1 and Old World Transportation, which together comprise the US’ largest manufacturer of ethylene oxide and ethylene glycol, with a transaction value of $795 million. The units of Old World Industries, which is located in Texas, have ethylene oxide capacity of 435,000 tonnes per annum. The transaction is expected to be complete in the first quarter of this year.
IVL is in the process of constructing a $700-million manufacturing plant to produce PET, purified terephthalate acid (PTA) and polyester in India, and plans an additional plant for making PTA and PET with a similar investment size in the country.
