HEBEI, China—Chinese carbon black and chemicals supplier Longxing Chemical is acquiring China Rubber (Chongqing) Carbon Black from China Synthetic Rubber Corp (CSRC), the Taiwan-based parent of Continental Carbon Co.
In a stock exchange announcement Nov. 21, Longxing said it had signed a purchase framework agreement with CSRC Singapore for the deal, which is intended to expand production footprint in southwestern China.
Current production bases in Xingtai City, Hebei province, and Jiaozuo City, Henan province, are "continuously in full-load production," Longxing said, adding that the capacity utilization rate and production and sales rate also have been at a high level for a long time.
The company noted, however, that its sales in southwestern China were relatively small, due to long distances from production plants.
According to Longxing, Chongqing is one of China's major car industry bases, with many large tire companies.
The acquisition, it said, will help expand market reach and reduce transportation costs. Additionally, it will boost production capacity for its core product, carbon black, addressing what Longxing described as its "existing production capacity bottleneck problem."
