Nantong, Jiangsu – Chinese polyurethane mattress and pillow maker Healthcare Co. announced in November it will raise up to CNY 800m ($115m) through a private share placement.
It will use CNY 350m of the money to build new facilities in the US. A total of CNY 250m will go towards expanding is plant in Ruma, Serbia. The remaining CNY 200m will be used to boost cashflow
The US plant will have registered offices in Knoxville, Tennessee, but will be built in South Carolina, the company told UTECH-polyurethane.com. It revealed details of the new US plant in October.
An additional 10% tariff on exports to the US has been imposed since September. A Healthcare Co announcement said raising its prices or shifting production to Serbia cannot fully solve the problem. The plant in Serbia is running at close to capacity, the company added.
Furthermore, it will be possible to source MDI and TDI locally in the US. This could counter the fluctuation of MDI and TDI prices in the China market, the announcement added.
Over the first nine months of 2018 Healthcare Co. reported a 27% year-on-year rise in revenue to CNY2.1bn. Net profit during the period, however, dropped 24% to CNY110m.
The company has also acquired Spanish mattress maker Maxcolchon, which over the first nine months of 2018 experienced a 41% jump in net profit to CNY11m on a 24% rise in revenue to CNY151m.
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