FICO-Tay Ninh Joint Stock Cement Co. (TAFiCO) has taken over HCMC-based Phuong Nam cement plant for a total of VND400bn (US$25m).
Phuong Nam Cement Co, the owner of the factory in Hiep Phuoc Industrial Park in Nha Be District, yesterday handed over the 500,000tpa factory to TAFiCO after two months of discussing pricing issues.
Lai Duy Chinh, chairman of Construction Material General Company No.1 (FICO), the parent firm of TAFiCO, said the deal was part of its investment expansion plan.
With convenient access to transport routes, the Phuong Nam factory will leverage the company, which will initially import clinker from Thailand or buy it from local suppliers for cement production.
Phuong Nam has been renamed as FICO Cement Factory and will be recommissioned early next month and its cement products will be launched as well. The factory’s output will be scaled up to 800,000tpa from the current 500,000t.
The construction of the company’s Tay Ninh cement plant started in Tan Hoa Ward, Tan Chau District in Tay Ninh Province two months ago with a capacity of 1.5Mt of cement and 4,000tpa of clinker. The US$178m project is being developed on 105 hectares.
TAFiCO will also build a port for transporting materials and products, and houses for experts.
BNP Paribas of France and China’s ICBC two months ago signed an agreement to provide FICO with US$97.1m in loans to build Tay Ninh factory.
Shareholders of TAFiCO have pledged to contribute to VND525bn, or 20% of the total investment capital, while the State provides VND699 billion in preferential credit.
The cement factory is part of the national development program for the industry from now till 2020, and also a focal project for southern provinces.
Nguyen Huu Phuoc, TAFiCO’s director of business and marketing, said the company expected to sell 100,000t of cement this year and would increase the figure to 500,000t next year, 800,000t in 2008, 1.2Mt in 2009 and 1.6Mt in 2010.
The company will sell 90% of its products in the country and export the remaining 10% to Cambodia.