| Wed 28 Nov 2007, 14:00 | | AFE - AECI Limited - Closures At Sans Fibres |
|
AFE
AFE
AFE - AECI Limited - Closures At Sans Fibres
AECI LIMITED
(Incorporated in the Republic of South Africa)
(Registration number. 1924/002590/06)
Share code: AFE
ISIN: ZAE000000220
CLOSURES AT SANS FIBRES
SANS Fibres (Pty) Limited (SANS) will be exiting from the nylon high
decitex industrial (HDI), the polyester HDI and the polyester light decitex
industrial (LDI) yarn manufacturing businesses by the end of December 2007.
The number of retrenchments, estimated to be about 850 people, as well as
closure costs will be finalised once consultations have been concluded with
all stakeholders including employees, customers and suppliers.
These SANS businesses have not been profitable for some time owing to
several factors:
- over investment in polyester HDI and LDI yarn plants, mainly in the
Far East, resulting in surplus capacity and very low prices;
- the significantly lower cost base of manufacturers in the Far East;
- the company`s inability to recover increasing raw material costs, in
full, from customers;
- the decision by the company`s predominant customer for nylon HDI to
exit -this business in South Africa;
- the strength of the rand.
This highly competitive situation will not change as investment in capacity
in the Far East is continuing.
It is in this context, and after failing to find a partner or owner which
could add value to these components or to SANS`s business as a whole, that
the decisions on closures at Bellville were taken.
The nylon LDI and the PET plants will continue to operate normally whilst
discussions with potential partners or purchasers for these businesses are
pursued.
SANS is a wholly-owned subsidiary of AECI Limited.
Woodmead, Sandton
28 November 2007
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 28/11/2007 14:00:02 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
