Starting 2014, polypropylene compounds will be manufactured in Saudi Arabia at a joint venture of A. Schulman (Akron, OH) and National Petrochemical Industrial Company (NATPET, Jeddah, Saudi Arabia).
The 50-50 joint venture, expected to be named NATPET-Schulman Engineering Plastic Compounds, will produce and globally sell polypropylene compounds. The joint venture is planning to build a polypropylene compounding plant in Yanbu, Saudi Arabia, where it expects to begin production by the end of 2014.
A. Schulman's initial equity investment in the relationship is approximately $14 million. Initial project costs, including construction of the facility, infrastructure needs as well as working capital requirements are approximately $70 million. Beyond the initial equity investment by the partners, the joint venture intends to take advantage of various low-interest loan options provided by the Saudi Industrial Development Fund and other lending institutions.