French tire maker Michelin and Indonesia’s Chandra Asri Petrochemical’s (CAP) subsidiary Petrokimia Butadiene Indonesia (PBI) have inked a deal to build a new $435m synthetic rubber plant.
The move follows establishment of a new joint venture, which will be 55% owned by Michelin and 45% by PBI.
Construction on the new synthetic rubber plant is expected to start in early 2015, with completion and start of operations expected by early 2017.
The new partnership would involve merging expertise of both firms, add major synergies and create value both for the Indonesian and South East Asian markets.
The French tire maker has been facing business setbacks following the ongoing European economic crisis.
PBI is also developing its butadiene plant in Cilegon, Banten which is expected to start production in July 2013 and will have total production capacity of 100,000 tons of butadiene per year.
The new plant would also use materials produced at PBI's Cilegon butadiene facility.
