UPDATED: AGY adds Chinese fiber capacity with acquisition

By: 
March 26, 2009

Fiberglass yarn producer AGY (Aiken, SC) has purchased a majority stake in E-glass yarns maker Shanghai Grace Technology Co. Ltd. in a bid to expand its global reach and better serve a growing Asian customer base. AGY purchased a 70% interest in the business from Grace THW Holding Limited. AGY indicated that it has the “option and intent” to purchase the remaining outstanding shares in the near future, with the initial acquisition to be finalized in the second quarter.

AGY says the facility has capacity in excess of 18,000 tonnes/yr, and is part of its bid to boost its standing in Asia. In a release, AGY President and CEO Doug Mattscheck, said, “Our goal is to become the preeminent independent yarn manufacturer in Asia by offering E-glass products with a strong base of local support and manufacturing,” adding that his company is currently building its sales, marketing, and customer-service teams. Jeff Davis, AGY's president, told PlasticsToday that AGY has had a significant Asian business for many years, serving the market with a direct AGY sales force and offering products produced in its Aiken, SC and Huntingdon, PA facilities.

 

Davis believes the Chinese market for glass fibers will come to mirror western ones. "Today, the largest end market in China by volume is Electronics," Davis said. "AGY fully expects that other markets which are significant in the U.S. and Europe,  like aerospace, construction, automotive, and wind energy, will develop very quickly in China over the next several years."

 

According to a Research and Markets report, significant interest in compounding glass fiber with thermoplastic resin has raised expectations for the market, creating a “huge growth potential for glass fiber in China.” That said, the report found that the glass fiber supply and demand balance showed significant overcapacity in 2007, with the gap forecast to widen. [email protected]

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