By Richard Higgs, European Plastics News
London -- Interfoam Holding, the parent group of the top polyurethane foam producer in the Ukraine, has postponed a public offering of shares to fund an ambitious expansion plan in the face of "unfavourable macroeconomic conditions".
Interfoam still aims to consolidate its position in the Ukraine and Moldova through targeted acquisitions and organic growth, and to expand into the Russian and Polish markets.
The company has to decide on one of two routes to achieve its growth strategy: either it will acquire two existing production plants in central and western Ukraine from the Russian PU foam producer Foamline, or it could construct a new plant itself in western Ukraine, Interfoam said in a statement.
Moscow-based Foamline, which serves the upholstery, furniture and automotive sectors, has a number of plants across the former CIS countries. Its Ukrainian facilities are Foamline-West in western Ukraine, and Foamline-Dnepr in Marganets city in the Dnipropetrovsk region.
At the start of December, Interfoam said negotiations to acquire a stake of more than 50 percent in Foamline were continuing and the acquisition had received the green light from the Ukrainian competition authorities.
Whichever route Interfoam decides to take, it also intends to launch a downstream plant to make PU foam mattresses and other products such as pillows and foam sponges. Prior to the share issue delay, the group was hopeful this plant could start up in 2012 if it chose the favoured acquisition route.
Successfully acquiring the national Foamline units would mean Interfoam continuing to produce PU foam at the Foamline-West plant, while converting the Foamline-Dnepr facility to manufacturing of mattresses and other downstream products. It estimates that total investment for the acquisition option would be €21.6 million.
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