Asia Cement Corp., a major producer of cement in Taiwan, announced a budget of US$127.32m to expand production capacity in China. The producer will expand capacity by 6Mt in central China via mergers and self-built plants.
Asia Cement will budget CNY236m to buy 70% of Xinlinyun Cement Corp. in Wuhan, Hubei province through its China subsidiary-Asia Cement China Holding Co. Once finalised by the end of June, the acquisition will help Asia Cement boost annual output by 2Mt.
Asia Cement’s parent will also increase investments by US$71.25m to increasingly set up two cement kilns in its cement plant in Jiangxi province. Each of the proposed plants will be able to produce 2Mta of cement.
Asia Cement China CEO T.H. Chang noted the acquisition of Xinlinyun Cement will be a milestone for his company which had boosted production by building own plants in China before.
Building presence along the Yangtze River, Asia Cement China registered CNY610m in after-tax earnings last year, up 49% YoY. Despite a 44% YoY decline, the company was still the largest Taiwanese-invested cement producer in China with after-tax earnings reaching CNY67.68m in the first quarter of this year.
With an added 10 new production lines in China by the end of this year, Asia Cement will see annual production capacities in China total over 34Mta.