Kraton Initiates Project Assessment for New 30 Kta HSBC Plant in Asia

HOUSTON and SHANGHAI, Aug. 24 /PRNewswire-FirstCall/ -- Kraton Performance Polymers, Inc. (NYSE: KRA), a leading global producer of styrenic block copolymers or "SBC's" (together with Kraton Polymers LLC and its other subsidiaries, "Kraton"), announced that it has initiated a project assessment, which includes site-selection activities, to identify options for building a new, hydrogenated styrenic block copolymer (HSBC) plant in Asia.

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Strong growth in Kraton's differentiated grades of HSBC's has created the need for additional manufacturing capacity in the region. The site-selection team is expected to make a recommendation by December 2010, followed by a detailed cost-assessment by early 2011. Kraton anticipates seeking final Board of Directors' approval soon thereafter, whereupon construction of the plant would likely commence in the first half of 2012, with start-up occurring as early as the second half of 2013.

The proposed 30 Kta HSBC manufacturing facility would employ Kraton's latest state-of-the-art technology for producing HSBC's, and should set a new global standard for manufacturing costs and product quality.

"Kraton has built a strong presence in Asia, and such an investment would represent the next step to grow our position in the region—committing the necessary resources, technology and capital," said Kevin M. Fogarty, President and Chief Executive Officer. "The growth in application and technology development, using Kraton's styrenic block copolymers in Asia, continues to accelerate. This new plant should help facilitate this additional growth, demonstrating further our commitment to the region," he said.

Additionally, Kraton has recently relocated its Shanghai, China office to a new facility, double the size of the previous location, to better accommodate on-going increase in staff capability, which has more than doubled in China since 2006.  

"This new office facility includes a multi-functional customer service center and a dedicated training facility," added David A. Bradley, Kraton's Chief Operating Officer.  "When combined with our expanded warehouse capacity in Shanghai Waigaoqiao Free Trade Zone and our recent investments to enhance product packaging in China, we believe customers in the region will benefit from Kraton's commitment to further enhancing our service capability," he concluded.  

As the leading global producer of engineered polymers, Kraton continues its long-standing tradition of 'Giving Innovators Their Edge.' For more information about the Asia Pacific expansion plans, please send an email to [email protected].

About Kraton

Kraton Performance Polymers, Inc., through its operating subsidiary Kraton Polymers LLC and its subsidiaries, is a leading global producer of engineered polymers and, we believe, the world's largest producer of styrenic block copolymers ("SBC's"), a family of products whose chemistry was pioneered by us almost fifty years ago. SBC's are highly-engineered thermoplastic elastomers, which enhance the performance of numerous products by delivering a variety of attributes, including greater flexibility, resilience, strength, durability and processability. Our polymers are used in a wide range of applications, including adhesives, coatings, consumer and personal care products, sealants and lubricants, and medical, packaging, automotive, paving, roofing and footwear products. We currently offer approximately 800 products to more than 700 customers in over 60 countries worldwide, and are the only SBC producer with manufacturing and service capabilities on four continents. We manufacture products at five plants globally, including our flagship plant in Belpre, Ohio, as well as plants in Germany, France and Brazil, and a joint venture plant operated in Japan.

Kraton, the Kraton logo and design, and the "Giving Innovators their Edge" tagline are all trademarks of Kraton Polymers LLC.

Forward Looking Statements

This press release includes "forward-looking statements," which are statements other than statements of historical fact and are often characterized by the use of words such as "believes," "expects," "estimates," "projects," "may," "will," "intends," "plans" or "anticipates," or by discussions of strategy, plans or intentions. All forward-looking statements in this press release are made based on management's current expectations and estimates, which involve risks, uncertainties and other factors that could cause results to differ materially from those expressed in forward-looking statements.  These risks and uncertainties are more fully described in "Part I. Item 1A. Risk Factors" contained in our Annual Report on 10-K, as filed with the Securities and Exchange Commission and as subsequently updated in our Quarterly Reports on Form 10-Q, and include risks related to: conditions in the global economy and capital markets; our reliance on LyondellBasell Industries for the provision of significant operating and other services; the failure of our raw materials suppliers to perform their obligations under long-term supply agreements, or our inability to replace or renew these agreements when they expire; limitations in the availability of raw materials we need to produce our products in the amounts or at the prices necessary for us to effectively and profitably operate our business; competition in our end-use markets, by other producers of SBCs and by producers of products that can be substituted for our products; our ability to produce and commercialize technological innovations; our ability to protect our intellectual property, on which our business is substantially dependent; infringement of our products on the intellectual property rights of others; seasonality in our Paving and Roofing business; financial and operating constraints related to our substantial level of indebtedness; product liability claims and other lawsuits arising from environmental damage or personal injuries associated with chemical manufacturing; political and economic risks in the various countries in which we operate; the inherently hazardous nature of chemical manufacturing; health, safety and environmental laws, including laws that govern our employees' exposure to chemicals deemed harmful to humans; regulation of our customers, which could affect the demand for our products or result in increased compliance costs; international trade, export control, antitrust, zoning and occupancy and labor and employment laws that could require us to modify our current business practices and incur increased costs; our relationship with our employees; loss of key personnel or our inability to attract and retain new qualified personnel; fluctuations in currency exchange rates; the fact that we generally do not enter into long-term contracts with our customers; a decrease in the fair value of our pension assets, which could require us to materially increase future funding of the pension plan; and concentration of ownership among our principal stockholder, which may prevent new investors from influencing significant corporate decisions.  Readers are cautioned not to place undue reliance on forward-looking statements. We assume no obligation to update such information.

SOURCE Kraton Performance Polymers, Inc.