Michelin has reached a deal with a subsidiary of Jakarta-listed PT Chandra Asri Petrochemical to build a $435 million synthetic rubber plant.
The two have signed an agreement to establish a joint venture that would be 55% owned by Michelin and 45% by Chandra Asri’s wholly owned subsidiary, PT Petrokimia Butadiene Indonesia (PBI).
Construction of the synthetic rubber plant is expected to be launched in early 2015 and completed within two years.
PBI is currently developing Indonesia’s first butadiene plant in Cilegon, Banten. The plant is expected to commence production in July with annual production capacity of 100,000 tons of butadiene, which is used to make materials in tire production such as styrene butadiene rubber (SBR), acrylonitrile butadiene system (ABS) and styrene butadiene latex (SBL).
Apart from its cooperation with Chandra Asri, Michelin has an investment in one of the country’s tire manufacturers, PT Gajah Tunggal, which is listed on the Indonesia Stock Exchange (IDX) under the code GJTL. Michelin held 10% stake in GJTL since 2004. (Southern Africa Treads)