Recently, Longsheng, the third largest chemical giant in Germany and the sixth largest in Europe, signed an agreement with two local partners in Shanghai, and announced that it would jointly establish a joint venture, taking China's tire, leather and other professional chemical markets as the business breakthrough and stepping into the Chinese chemical market.
This time, by means of small shareholders' participation, Longsheng established Anhui Tongfeng Shengda Chemical Co., Ltd. jointly with Xinda Chemical as the manufacturer and Anhui Tongfeng as the investor. The joint venture, located in an industrial park in Tongling City, Anhui Province, is expected to be put into production in the second half of 2006 to process and manufacture high-tech antioxidant products. With the production of rubber antioxidant in China, Longsheng has become the first foreign enterprise to produce rubber antioxidant in China.
According to Dr. Wen Haohui, a member of the management board of Langsheng in charge of Langsheng's Asia affairs, the research shows that since the beginning of this century, China's tire production has grown at an annual rate of 30%. Rubber is the most important raw material in tire industry. Through the joint venture, Lansheng will expand its leading position in the Chinese market.
According to the insiders, this equity participation indicates that China's continuously growing tire, leather and other professional chemical markets are beginning to be favored by the world's chemical industry. Different from the earlier all-round and large-scale investment behavior, the rising chemical investment boom is increasingly developing to the depth and specialization.