Tycoon Group expands industrial-fastener investments in China

Taipei, May 9, 2005 (CENS)--Tycoon Group Enterprise Co., Ltd. Has decided to invest US$10 million to open a factory in Hebei Province of mainland China to turn out fasteners for cars, constructions and industrial engineering projects built in the mainland.

The Taiwanese industrial-fastener supplier made the decision considering the huge profit promised by the mainland market, which has returned the company's first mainland investment with hefty profit in barely six months. The company is the first Taiwanese fastener supplier operating facilities in the mainland to pinpoint the mainland's domestic market.

The company started volume production at its first mainland factory early this year after completing pilot production at the facility late last year. The factory, specializing in small fasteners, had revenue of only NT$31 million (US$1 million at US$1:NT$31) last quarter, but it began making money in March. The company's spokesman, S.H. Lin, pointed out that the mainland market is more profitable than other overseas markets.

The projected facility is designed to have output of 24,000 metric tons of fasteners valued at about NT$1.44 billion (US$46 million) a year and form a complementary relationship with the company's first mainland factory, which was set up at an investment cost of US$5.9 million. Tycoon's operating factory in the mainland now turns out 3,000 metric tons of fasteners a year.

Lin said his company acquired several Taiwanese industrial peers focusing on big-sized wares last year, laying solid foundation for its production of such items as hex head cap fasteners, hex socket cap fasteners and welding studs.

Tycoon's chairman, W.S. Huang, pointed out that his company would submit the investment plan to the Ministry of Economic Affairs for approval as soon as possible. The company will kick off the construction in July this year once the plan is approved.

Huang's company has an annual revenue goal at NT$10 billion (US$322.5 million) soon, including revenue from its factory in Thailand, which has snatched up over 40% of the Thai market for industrial fasteners.