Lenzing may buy Chinese viscose makers

Thursday, 20 December 2012 00:14 - - {{hitsCtrl.values.hits}}

Reuters: Austrian man-made fibres group Lenzing would consider buying viscose makers in China, the world’s biggest fibre market and textile exporter, its Chief Executive said.

Peter Untersperger said it makes sense for Lenzing to take an active part in a consolidation of the industry that is considered inevitable sooner or later in the huge, but fragmented, and largely unprofitable Chinese viscose market.

“I would not rule it out,” Untersperger told Reuters in an interview. “It could happen quickly in the medium term.”

Lenzing is the world’s biggest maker of viscose, with about 20 per cent of the global market for the pulp-based textile used as a substitute for cotton in clothing and hygiene products.

The Austrian company has recently doubled the capacity of its own viscose factory in the city of Nanjing, investing 53 million euros ($70 million) in it over the course of a year.

Chinese viscose producers account for more than half of world production after a sharp expansion in response to rising demand in the last few years, but most are too small to be competitive and have been hurt by falling prices, analysts say.