Nanya Plastics Starts up 3-Year, US$1.06 Bn Expansion Investment

Nanya Plastics Crop., reportedly the most profitable member of the Formosa Plastics Group (FPG) last year, has recently started a three-year, NT$33 billion (US$1.06 billion) investment project targeting its businesses in Taiwan, China, Vietnam and the United States.

Its operations in China will undergo seven new expansion projects this year at its electronic-materials and petrochemical factories. The company is reportedly the world's No.1 manufacturer of several electronic materials and the world's No.2 maker of copper clad laminates.

This year, the company's electronic-material manufacturing in China will exceed that in Taiwan in size for the first time once the new expansions at its printed circuit board factory and copper clad laminate factory in China are completed.

The steady recovery in the American economy has motivated the company to add an ethylene glycol (EG) factory with annual capacity of 828,000 metric tons stateside, whose, with the factory once completed, petrochemical capacity will become the company's second biggest globally, next only to Taiwan's.

The company's American subsidiary puts out 380,000 metric tons of EG and 870,000 metric tons of polyester fiber by using ethylene supplied by the American subsidiary of Formosa Plastics Corp. (FPC). Nanya's American subsidiary ships  products mostly to North America, Latin America and North Africa.

With increased output of less expensive EG in America, Nanya is expected to see global sales surge this year, with the Americas having accounted for 15 percent of Nanya's profit.

Nanya's polyester fiber factory in South Carolina is increasing shipments to local customers due to having landed new customers.

FPG executives believe the key to sharpening corporate competitiveness in future lies in  developing presence in the shale gas industry and the markets of Association of Southeast Asia Nations (ASEAN) and China.

In China and Vietnam, an ASEAN nation, the company will spend NT$13.34 billion (US$430.32 million) and NT$7.09 billion (US$228.70 million) respectively to boost capacity. Its investment will mostly focus on manufacturing electronic materials and bisphenol A (BPA) in the mainland and manufacturing of biaxially oriented polypropylene (BOPP) and polyvinylchloride (PVC) films and synthetic leather in Vietnam. (KL)

Nanya's Expansion Plans (2015 and 2016)

Location	Capital	Product	Annual  revenue	Investment proportion
Taiwan	NT$6.74bn	Optoelectronic-grade PET film	NT$3.69bn	24.5%
Overseas	NT$20.72bn	A-PET film in the United States; electronic materials, BPA, and PVC film in mainland China; PVC and BOPP films and PU leather in Vietnam	NT$24.29bn	75.5%
Total	NT$27.46bn		NT$27.98bn	100%

Source: Nanya