Taipei, Oct. 27 (CNA) Taiwan Cement Corp., one of the leading cement suppliers in Taiwan, has been in talks with Turkish conglomerate Oyka to set up a joint venture in Turkey, eyeing the growing Turkish market, according to the company.
Taiwan Cement has said its board of directors approved a proposal on Friday to first set up a wholly owned subsidiary -- Dutch TCC Holdings -- and then for the company to enter into negotiations with Turkish company Ordu Yardimlasma Kurumu, also known as Oyak, to set up a joint venture.
As long as the talks proceed well, Dutch TCC will spend up to US$1.1 billion to set up a joint venture with Oyak to take a 40 percent stake in the new company.
Taiwan Cement said the investment plan in Turkey will mark the first time for the company to go beyond the Asia market by extending its reach to Turkey.
Through the investment, Taiwan Cement Vice President Edward Huang said his company plans to use the joint venture as a springboard to enter the markets in the Middle East, Eastern Europe and Africa in the future.
Huang said Taiwan Cement has not ruled out the possibility of entering the reconstruction market in war-torn Syria.
According to Taiwan Cement, Oyak owns a broad portfolio in cement production scattered across Turkey, through its subsidiaries, such as Aslan, Bolu, Unye, Mardin, Adana, Denizli and Beton, and produces about 12 million tons of cement a year.
Huang said in 2017, Oyak took a 16 percent share of the cement market in Turkey, and the joint venture is expected to make Taiwan Cement an important business partner of Oyak and allow the two to tap the cement market in Turkey together.
Huang added that Taiwan Cement will use the strategic partnership with Oyak to conduct acquisitions and form more business alliances in Turkey in a bid to serve as a dominant power in the cement market there.
According to Huang, with a population of 80 million, Turkey has great growth potential in terms of domestic demand and ranks as the largest cement market in Eastern Europe and Southwest Asia. As a result, it is worthy of investment by the Taiwanese firm, he said.
Due to the investment plan in the joint venture, Huang said, Taiwan Cement will take advantage of Oyak's presence to strengthen the Taiwanese partner's global presence.
In addition to local cement plants located in Hualien, Heping and Su'ao, Taiwan Cement operates a broad production base in China, running a group of production facilities in Guangdong, Guangxi, Jiangsu, Liaoning, Sichuan, Chongqing, Yunnan, Anhui and Fujian provinces, according to the company's website.
Taiwan Cement currently ranks as the sixth largest cement supplier in China.
Earlier this year, Taiwan Cement quoted company chairman Chang An-ping as saying the firm is interested in efforts to transform itself into an energy-efficient cement maker and to boost the company's international visibility.
Extending its reach to the U.S. and European markets could help it achieve this goal, Chang said.
