Taipei--Lealea Enterprise Co. (??), one of the largest polyester filament yarn and polyester chip makers in Taiwan, said Saturday it will set up its first overseas factory later this year in Indonesia.
Lealea Chairman Kuo Shao-yi (???) has made investing in Indonesia one of the company's strategic priorities and set the goal of launching operations at the production site in the second half of this year, the company said.
Lealea signed a memorandum of understanding with PT Taroko Indonesia and will spend up to US$50 million to acquire PT Taroko's production facilities located in Bandung, the third largest city in the Southeast Asian country.
PT Taroko is a joint venture between Taroko Textile Co. (???), another textile firm in Taiwan, and Nan Ya Plastics Corp. (??), one of the main subsidiaries of the Formosa Plastics Group (????).
Because Taroko wanted to diversify its interests beyond the textile sector and Nan Ya did not want to continue its investment in PT Taroko, Lealea seized the chance to acquire the facility, which it plans to upgrade, to start its business in Indonesia.
Kuo has repeatedly sent delegations to Bandung to evaluate the 50-hectare production site and conduct an assessment on how to upgrade the production facilities, the company said.
According to Lealea, its Bandung plant will be initially involved in the fabric dying and finishing business before expanding to yarn making in the future.
The company believes that demand for textile products in the Indonesian market is strong, and because textile exports from Indonesia to Japan and South Korea enjoy duty-free status, the new plant will export half of its production.
The Lealea Group, which Lealea Enterprise is part of, is also planning to have another subsidiary, Li Peng Enterprise Co. (??), set up open warehousing facilities in the U.S. in the second half of 2017.
The facility will store the nylon chips and polyester chips Lealea produces in Taiwan and Southeast Asia to meet demand in the U.S. market and will be large enough to accommodate about 2,000 metric tons of textile products.
Despite its overseas expansion plans, however, the Lealea Group said it remains fully committed to its manufacturing operations in Taiwan to enhance its sustainable development.
Source: Focus Taiwan News Channel