HOUSTON (April 28, 2015) — Synthetic rubber producers Repsol S.A. and Grupo Kuo S.A.B. de C.V. have agreed to revise and extend their Dynasol Elastomers joint venture with the aim of making it a top 10 player in the global SR market, focused on developing products for the high-performance tire sector.
The agreement is subject to regulatory approvals, the partners said.
Spain's Repsol and Kuo of Mexico have been equal partners in Dynasol since 1999. The JV claims to be the world's second largest producer in asphalt modification and a leader in other applications such as adhesives, sealants, and technical compounds.
The modified agreement calls for Kuo and Repsol to put more of their SR assets into the joint venture, expanding Dynasol's annual capacities to more than 500,000 metric tons. The revamped business will be headquartered in Madrid.
Dynasol has facilities in Altamira, Mexico, and in Santander, Spain, and is in the process of opening a plant in Liaoning, China, this quarter.
As part of the new deal, Kuo will provide Dynasol with its emulsion SBR and nitrile rubber units in Altamira and nitrile rubber business in China as most of production at those units is allocated to the tire industry. Repsol will contribute its rubber vulcanization accelerators unit, General Química, located in Álava, Spain.
With estimated annual revenues of $750 million, the venture is to become a major player in high-growth markets such as Latin America, North America, and China, the partners said.
The move “will make Dynasol an important player in the high-performance tire market, and we will significantly increase our production capacity and supply to our chemicals division,” said Repsol Chairman Antonio Brufau.
“We are very pleased to consolidate this alliance with Repsol, our long term and strategic partner. This new company will strengthen our position as a global player in the synthetic rubber market,” said Fernando Senderos Mestre, chairman and CEO of Grupo Kuo.