The Fair Trade Commission (FTC) has approved a joint venture between Formosa Petrochemical Corp and Kraton Performance Polymers Inc. The joint venture will include the construction of a plant to produce hydrogenated styrenic block copolymer (HSBC). Located in Mailiao, the plant is expected to cost between US$165-200 mln and to be operational by H2-2013. Because Formosa Petrochemical has more than a 25% share of Taiwan’s ethylene, propylene and gasoline markets, it had to seek permission from the FTC for the project to go ahead because of monopoly concerns.
As per an FTC statement, although Formosa Petrochemical is the leading provider of petrochemical ingredients, Taiwanese suppliers are still able to import such ingredients from abroad and the deal would therefore not limit their sourcing choices. Further, the joint venture will not lead to any dramatic change in market share and has therefore been approved.