Honeywell and Sinochem Announce Formation of Joint Venture in China Meets growing demand in Asia for energy efficient and environmentally friendlier materials
MORRIS TOWNSHIP, N.J. and SHANGHAI, Oct. 10, 2011 /PRNewswire/ -- Honeywell (NYSE: HON) and Sinochem Group announced today they have signed an agreement to form a 50/50 joint venture to produce and sell blowing agents for energy efficient foam insulation in China to meet growing demand in the Asia region for more energy efficient and environmentally friendlier materials. The formation of the joint venture is subject to Chinese government approval.
The joint venture, to be located in Taicang, Jiangsu Province, will produce HFC-245fa, a non-ozone-depleting rigid foam blowing agent used in insulation for appliances, construction, transportation and other applications where maximum energy efficiency is required.
The venture is expected to begin production in late 2013. Honeywell's newly launched next generation HFO lower-global-warming-potential blowing agent – Solstice™ Liquid Blowing Agent -- may also be produced by the joint venture.
"This joint venture with Sinochem, one of the strongest companies in China, will help meet growing demand for this material as Asian customers rapidly adopt more energy efficient and environmentally compliant materials," said Andreas Kramvis, president and CEO of Honeywell Specialty Materials. "Having Asian supply close to local customers is important to ensure global supply of this material in the future."
"Honeywell is a globally-renowned multinational company with diversified, leading technologies, products and services," said Yinping Wang, vice president of Sinochem Group. "The formation of the joint venture enhances our product portfolios and service capabilities in energy efficient and environmentally friendly materials, which aligns with both companies' business development strategies, and reinforces the foundation for cooperation in depth. The joint venture depicts an exciting prospect."
China and other Asian nations are rapidly adopting hydrofluorocarbon (HFC) materials, including blowing agents and refrigerants, to comply with the Montreal Protocol on Substances That Deplete the Ozone Layer. China's Ministry of Environmental Protection requires phasing out the use of ozone-depleting blowing agent R-141b in small household appliances by 2015. At the 15th United Nations Climate Change Conference Copenhagen 2009, the Chinese government committed to a 40 to 45 percent reduction of carbon dioxide emissions in 2020 compared to the 2005 emissions level. Based on this, demand for blowing agents and the next generation of lower-global-warming-potential blowing agents in China is expected to grow significantly in coming years.
Honeywell HFC-245fa is a non-ozone-depleting HFC liquid blowing agent that provides the foam's superior insulating properties compared to other forms of insulation. Honeywell HFC-245fa blowing agent is used extensively by appliance manufacturers to insulate refrigeration equipment to meet increasing global energy efficiency requirements. It is also used in construction and transportation applications.
The new joint venture will have exclusive rights to sell HFC-245fa in the Asia region. Honeywell, which currently manufactures the blowing agent at its Geismar, La. facility, will continue to sell HFC-245fa in all other areas under its Enovate brand name.
Honeywell International (www.honeywell.com) is a Fortune 100 diversified technology and manufacturing leader, serving customers worldwide with aerospace products and services; control technologies for buildings, homes and industry; automotive products; turbochargers; and specialty materials. Based in Morris Township, N.J., Honeywell's shares are traded on the New York, London, and Chicago Stock Exchanges. For more news and information on Honeywell, please visit www.honeywellnow.com.
Sinochem (www.sinochem.com), established in 1950, is one of the key state-owned enterprises under the supervision of SASAC (State-owned Assets Supervision and Administration Commission) and one of the largest companies in China. It has been in Fortune Global 500 list twenty-one times and ranks 168th in the 2011 list. Sinochem has five business segments including agriculture, energy, chemical, real estate and finance. It is China's biggest integrated agricultural company with fertilizer, pesticide and seed products, as well as China's fourth largest oil company and leading chemical service provider. It has extensive influence in China's high-end commercial real estate and non-banking financial businesses. For more news and information on Sinochem, please visit www.sinochem.com.
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