LaPLACE, La.—Denka Performance Elastomer L.L.C. will create a new corporate headquarters at its site in LaPlace.
The facility, which was DuPont Co.'s former Neoprene-branded polychloroprene synthetic rubber business, is expected to bring 16 new corporate executive jobs, with an average annual salary estimated at $80,000 plus benefits, according to Louisiana Economic Development, a state government agency. The project will result in another 81 indirect jobs in the greater New Orleans area and Southeast region of Louisiana, the LED projected.
“With one of the nation's best business climates, Louisiana offers corporations very attractive business operating costs, and our state ranks No. 1 for the lowest tax burden applied to new and mature manufacturing projects and No. 4 for lowest tax burden on corporate headquarters,” Louisiana Gov. Bobby Jindal said in a statement.
Denka Performance Elastomer is a newly formed joint venture in which Tokyo-based Denka Co. Ltd. owns 70 percent and Mitsui Co. Ltd., also based in Tokyo, owns 30 percent. The joint venture was established as a result of their acquisition of DuPont's Neoprene business, which was completed effective Nov. 1, according to a Denka news release.
Financial terms were not disclosed, but a Denka spokesman said the firm spent between $80 million and $110 million to acquire the facility.
The release said DuPont will retain 235 existing manufacturing jobs associated with the Pontchartrain Works production site in LaPlace, where DuPont will continue to operate its separately owned Kevlar business.
Denka manufactures and distributes chemical products encompassing chloroprene rubber, organic and inorganic materials, polymer processing, electronic materials and pharmaceuticals. According to its website, it operates 10 other manufacturing facilities, six in Japan, three in Singapore and one in China.
Mitsui, a Japanese general trading company, has 142 offices in 66 countries.
Denka operates another polychloroprene plant in Japan, which produces the material using the acetylene method. Denka said the plant opened in 1962 and supplies 80 countries. In 2010, the firm increased its annual polychloroprene rubber capacity to 100,000 metric tons.
According to Denka, DuPont manufactures polychloroprene using the butadiene method and supplies North America, South America and Europe.
The Denka spokesman said the acquisition will establish a more stable supply structure and is expected to increase customer satisfaction. He added that the deal will contribute to Denka's further sustainable growth, provide production flexibility between the plants and meet Denka's midterm strategy of restructuring the production structure.
The LaPlace facility is Denka's only manufacturing plant in North America. The spokesman said the firm has no plans to expand the plant in the immediate future; rather it will focus on expanding its sales and cultivating new demand for polychloroprene in North America and worldwide.
“Chloroprene rubber has been a core business for Denka Japan for many years, and I am sure this new addition in LaPlace will largely contribute to our future growth, enabling us to serve the market and customers better,” Koki Tabuchji, president and CEO of Denka Performance Elastomer, said in a statement.
Louisiana Economic Development said it began negotiations with Denka in February and offered a competitive incentive package that included its LED FastStart program, which according to LED is the No. 1 state work force development program in the nation. LED said Denka is expected to utilize the state's Quality Jobs program.
“The state of Louisiana has a lot of great incentive programs,” the Denka spokesman said. “We think some of them are very attractive.”