Dow Chemical and Turkey-based Aksa Akrilik Kimya Sanayii A.Ş. on Tuesday signed a definitive agreement to form a joint venture to manufacture and commercialize carbon fiber and derivatives.
The joint venture will develop and globally market a broad range of products and technical service support in the rapidly expanding carbon-fiber based composites industry.
Strong and lightweight, carbon-fiber based materials are used in a variety of applications in growth industries such as wind energy, construction, transportation, and infrastructure, where weight savings, emissions reduction, durability and energy efficiency are key factors.
Currently, the carbon fiber composites industry is estimated at $10 billion globally and is expected to reach $40 billion by 2022, according to company officials.
Under terms of the agreement, Dow and Aksa will each hold a 50% stake in the joint venture. Following initial equity investments from the two companies, the JV will finance its growth through cash flow from operations and financial institutions.
Total investment in the project, including third party investments, is expected to reach $1 billion in five years and create up to 1,000 employment opportunities, the companies said.
The JV will expand on Aksas existing carbon fiber production assets in Yalova, Turkey, and will capture growth by creating a large-scale, integrated production capability for the manufacture and supply of advanced carbon fiber technologies.
The venture will have a particular focus on bringing solutions to market that reduce overall costs, thereby enhancing economics and driving adoption in a broader array of markets.
This partnership with Aksa is another strong example of how Dow is advancing its innovation and growth strategy, and demonstrates our unwavering commitment to invest in high-value, innovation-rich sectors through strategic partnerships, said Dow CEO Andrew Liveris.
Together our companies will apply science, world-class manufacturing capabilities and technical expertise to deliver innovative solutions that address some of the worlds most pressing challenges, such as increasing the energy capture of wind turbines, improving the fuel economy of automobiles, and extending the life of roads and buildings.