JJC, based in Jiangsu Province of China, produces Acrylic Acid (“AA”) and Acrylic Esters (“AE”). AA and AE are widely used as intermediate chemicals for coatings, paints, adhesive, textile and water treatment. The Company has a production capacity of 40,000 tons which will be expanded to over 200,000 tons by 2007, making them the largest producer of AA and AE in China.
Led by Mr. Sun Liping, a veteran in the Chinese chemical product industry, JJC has been aggressively expanding its facilities to cope with the growing demand for AA and AE. JJC’s AA and AE have been acknowledged as one of the best in China, being of comparable standards against products from its international competitors. Currently, JJC competes with both domestic and foreign competitors such as BASF, Rohm & Hass and Dow Chemical.
The strategy going forward is to build on the company’s market position, establish partnerships with long term customers, expand its export sales and increase the existing product range, including diversification into complementary areas. The opportunity for the business is excellent. The total demand for AA and AE in China is estimated at 900,000 ton per annum and is expected to grow around 10 – 15% in tandem with China’s industrialization.
Tan Keng Boon, Managing Partner of SEAVI Advent, said: “Jiangsu Jurong Chemical personifies our Greater China strategy, whereby we seek investments in sizeable Chinese companies with good management team and having definite expansion strategies to leverage on the overall growth in China.”
The Company raised a total of US$13mil from institutional investors in this current round to fund its capital expansion and working capital needs. The company plans to list on the Singapore Stock Exchange in the near future. SEAVI has a Board Representation in JJC and will eventually hold a significant minority equity in the listed entity.