Norsk Hydro Buys 45% Stake In Taiwanese Aluminium Plant

STOCKHOLM (Dow Jones)- Norsk Hydro said Thursday it has signed an agreement to acquire a 45% ownership stake in Famco, an aluminium remelt plant under construction in Taiwan.

Famco will have an initial annual production of about 75,000 tons of extrusion ingot.

Taiwan is the third-largest extrusion market in Asia, with a total extrusion ingot consumption of about 400,000 tons — and the market is expected to grow.

Hydro is currently supplying this market from its primary production plant in Kurri Kurri and its part owned Tomago-smelter, both in Australia.

Hydro said it is committed to further expanding its activity in Asia in the years to come, and the Qatalum primary aluminium smelter under construction in Qatar will facilitate this ambition.

Hydro will market and sell the entire production of 585,000 tons from Qatalum, which is expected to start production in late 2009. Full production is expected mid-2010.

The remaining 55% of the Famco aluminium remelt plant will be held by the holding company E-Tech, in which Lawrence Cho is the main shareholder. Cho has been working as Hydro’s sales agent in Taiwan since 2004.

Famco is located in the Yunlin Industrial Estate in Yunlin County, along Taiwan’s western coast. The plant’s equipment will allow for production of a wide product range, including diameters ranging from four to nine inches, as well as special alloys.

The investment will mainly serve the Taiwanese market, with export possibilities to supply regional markets outside Taiwan.