UK-based Whatman, which makes paper products for the life sciences sector, has set up a JV in China to get closer to the country's booming pharmaceutical industry.
Its Chinese partner is Hangzhou Xinhua Paper Industry Co, which makes chemical analysis paper and related paper products, and the JV will construct a purpose-built manufacturing facility in the Zhejiang Hangzhou Tonglu Economic Development Zone, one of the fastest growing economic regions in southeast China.
The plant will not be complete until mid-2008 and in the meantime the two companies are working to combine sales forces and broaden distribution networks.
The JV company is 75% owned by Whatman,with Xinhua having the remaining 25%. The Chinese partner is contributing its profitable chemical analysis filter paper business which sells under the “Double Ring” brand. This business, which is today located in a shared manufacturing facility with other Xinhua paper making activities, had 2005 revenues of £2.5m and around 140 employees.
The JV has taken six months to get operational but LSE-listed Whatman makes the point that, unlike other JVs, this one is profitable from the day one.