AGY acquires controlling interest in Chinese glass firm

AGY purchases 70 percent of Shanghai Grace Technology Company Ltd., an E-glass yarns manufacturer, with the option to buy more in the near future.

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AGY (Aiken, S.C., USA), a producer of fiberglass yarns and high-strength fiberglass reinforcements, announced on March 18 that it has entered into a sale and purchase agreement (SPA) with Grace THW Holding Ltd. to acquire a 70 percent controlling interest in Shanghai Grace Technology Company Ltd. (Shanghai, China), a producer of E-glass yarns, with the option and intent to purchase the remaining outstanding shares in the near future.

The acquisition, which is expected to be finalized in second quarter 2009, will expand AGY’s geographic manufacturing footprint and enable it to service its growing Asia-Pacific customer base. The Asia-Pacific region represents a large market for AGY products and technology due to its diverse manufacturing base and continued economic growth. “We see significant opportunities in the Asia-Pacific region for market expansion in the high-end electronics markets that require fine yarn capabilities. Additionally, other key markets to AGY, such as aerospace, wind-energy and industrial applications, have experienced significant growth in Asia, and we are now in a position to service those requirements locally through the purchase of Shanghai Grace Technology,” commented Doug Mattscheck, AGY CEO.

The AGY-managed facility is a world-class, state-of-the art operation with current annual production capacity in excess of 18,000 million tons of glass fiber and expansion opportunities. "Our goal is to become the preeminent independent yarn manufacturer in Asia by offering E-class products with a strong base of local support and manufacturing,” said Mattscheck. “We are currently building our sales, marketing and customer services teams to capitalize on the region’s significant growth opportunities.”

Shanghai Grace Technology is a separately incorporated, independent entity from Shanghai Grace Fabric Company Ltd., another company owned by Grace THW Holding Ltd. AGY acquired no weaving operations in the transaction.