Orica keeping an eye on chem buys in Asia

29 October 1999 09:18  [Source: ICIS news]

SINGAPORE (CNI)--Australia's Orica will be on a continuous lookout for acquisitions and investment opportunities in Asia to enhance its core operations, CNI was told Friday.

In a telephone media conference in Melbourne, the company's managing director and chief executive officer, Phillip Weickhardt, said while there are no concrete plans as yet, chemical industries in Asia are restructuring and there are "lots happening in the explosives business" where Orica holds a leading global position.

"If investment opportunities fit with our core strategy and enhance value for our shareholders, we will pursue them," he said.

In the area of explosives, Orica is making greater headway in the China market with its 80% equity in a joint venture with Shandong Province-based explosives manufacturer Weihai City Factory 711. Orica's Weihai joint venture facility will manufacture detonators and packaged explosives when it starts operations next March.

In fiscal year 1999, Orica formed an explosives joint venture with ICI India to pursue opportunities in the South Asian market.

In chemicals, however, Weickhardt said Asia remains a tough place for the company to make money.

Orica's chemicals facilities in Asia include a films unit in Port Klang, Malaysia, and an adhesives and resins plant in Samarinda, Indonesia. "These will probably remain our chemical investments in Asia for now," he said.

Closer to home, Weickhardt said his company has no specific plans as yet to resume an attempt to acquire all the shares of its fertiliser affiliate Incitec Ltd. It failed in that effort in February 1999.

In addition to acquisitions, share buy-back is an option for Orica to grow its business, said Weickhardt, adding his company would consider that only if price and conditions are right.

By: Wing Gar Cheng
+65 6780 4359

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