China: Pulp & Paper Kemira Forms JV with China's Tiancheng

Editor: Alexander Stark

Kemira has signed an agreement to form a joint venture named Newco, with fatty acid chlorid producer Tiancheng, China.

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Kemira's headquarters in Helsinki
Kemira's headquarters in Helsinki
(Source: Kemira)

Helsinki/Finland — Kemira will have 80 % and Tiancheng 20 % of Newco. The newly formed company will mainly produce AKD wax and its key raw material fatty acid chloride (FACL). AKD wax, where the main component is based on renewable raw material, is a sizing chemical used in board and paper manufacturing to create resistance against liquid absorption. In addition, the JV plans to produce polyaluminum chloride (PAC) which is a coagulant for water treatment.

Through the backward integration the Finland based company expands its position in the value chain. The JV creates globally the largest and most integrated AKD wax manufacturing unit and almost doubles the company's AKD wax capacity.

Newco's site is located in the same chemical park with Kemira's plant in Yanzhou, China and the proximity of the two sites results in savings from logistics costs. The site also offers growth opportunities for other relevant chemicals.

The deal is subject to certain closing conditions and is expected to close in the first half of 2018.

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