Fairlawn, Ohio - Omnova Solutions Inc. has bought the remaining 49.9 percent interest of its joint venture manufacturing businesses in Thailand and China from its former partner, CPPC Public Co. Ltd, an affiliate of Charoen Pokphand Group (CP Group).
The buyout makes Omnova Solutions sole owner of CPPC-Decorative Products Co. Ltd in Thailand, and CG-Omnova Decorative Products (Shanghai) Co. Ltd and Beston Omnova Plastics (Taicang) Co. Ltd, both in China.
The Chinese units make coated polyurethane and vinyl upholstery for domestic automotive original equipment manufacturers (OEMs).
Omnova Solutions has been majority owner of these JVs since they were set up - in Thailand in 1999 and in China in 2000. Unconsolidated sales from the joint ventures for 2007 are expected to be approximately $106 million, according to a 7 Jan statement from Fairlawn-headquartered Omnova.
The three operations, which Omnova says largely serve the growing Asian commercial furnishings and upholstery markets, will be renamed Omnova Decorative Products Thailand, Omnova Decorative Products (Shanghai) and Omnova Decorative Products (Taicang).
In the company statement, Kevin McMullen, Omnova Solutions' chairman and chief executive officer said the deal "is a key part of our globalisation strategy and demonstrates our long-term commitment to the large and rapidly growing Asian markets."
"It allows us to more aggressively participate in the tremendous expansion underway in the region with innovative technology and products," McMullen added.
He also pointed out that the acquisition puts Omnova "in a better position to follow global customers who have moved manufacturing to Asia and are looking for high quality local sourcing."