RM450m Flexys expansion

By Rupa Damodaran

KUALA LUMPUR -- Flexys Chemicals (M) Sdn Bhd, a unit of US-based Solutia Inc, is investing RM450 million to expand its soluble sulphur and resin manufacturing operations in Kuantan.

Solutia president of Asia Pacific Robert S. Chu said plans are also afoot to double the production of soluble sulphur, which is used in the production of rubber tyres, in the coming years.

Although the company has been in Malaysia for the past decade, he said this was the first serious expansion Flexys has embarked on.

"It will increase supply for existing and new clients as industry players and manufacturers ramp up production ... we expect our business to grow in Asia Pacific," he said in an interview.

PVB, pioneered by Solutia, is used in the manufacture of laminated glass in both architectural and automotive applications.

"It's the first resin site outside, hence it is important that we have intellectual protection as well as a location which would help us scale across Asia."

Both sites which, when combined, would be Solutia's biggest facilities in the region, will provide 70 new jobs -- of which 40 are for skilled workers.

Chu said soluble sulphur is a billion dollar business, and said sales last year, which totalled more than US$2 billion (RM6.1 billion), contributed more than 40 per cent of the revenue.

The PVB resins are for the production of Saflex PVB interlayers meant for architectural, automotive laminated glass applications as well as solar encapsulants for the photovoltaic market.

In the case of the PVB market, which is close to US$900 million (RM2.75 billion) in size, Solutia also commands a 40 per cent market share.

Chu was bullish about the automotive industry, saying 2012 should see a strong showing from China, India and Southeast Asia.

China, emerging as one of the largest auto manufacturers in the world, has also drawn multinational companies to its rapidly growing automotive market.

"This year should be quite good because China will grow again, India will grow at the same rate and the US is rebounding," he added.

The automotive sector is expected to see strong growth in these markets, including Malaysia.

"The overall climate is quite healthy. Although local tyre produ-cers make up quite a small percentage, demBalenciaga