CP Kelco Announces International Biogums Manufacturing Improvements
Chicago, Ill. (May 20, 2003) ) As the world leader in biogums,
CP Kelco is implementing a plan to boost production capabilities and further
reinforce the company's position as the most cost effective producer in
the biogums marketplace. Major components of the plan include:
- Continued expansion of the company's Okmulgee, Okla. facility
- Expanded xanthan gum production in its Knowsley, United Kingdom facility
- Termination of a xanthan gum contract manufacturing agreement
According to Robert Toth, president and chief executive officer, this
comprehensive production plan is evidence of CP Kelco's aggressive commitment
to reinforce its global leadership position in biogums, especially in
xanthan gum. "We are delighted at how this plan leverages our market
leadership and enables us to pursue the competitive manufacturing position
required to meet the future needs of our customers around the world,"
said Toth.
The plan centers around recently completed negotiations that enable CP
Kelco to withdraw from an existing contract manufacturing arrangement
that originally ran until 2009. The early termination agreement will begin
yielding benefits immediately. "As CP Kelco reduces, then eliminates,
the amount of material produced under this toll manufacturing arrangement,
we will increase capacity at our existing facilities," said Mike
Size, biogums business unit director. "These decisions and investments
are important as we continue to improve our production flexibility and
cost position."
CP Kelco is making additional investments in expanding its Okmulgee plant-an
expansion highlighted by completion of a new state-of-the-art wastewater
treatment facility. The Okmulgee site, which occupies 95 acres, is the
largest biogum facility in the world.
"Our capacity expansion at Okmulgee is significant because it allows
us to relocate toll-produced capacity in-house-and that makes production
more cost effective," said Size. "This is important because
the biogums market is competitively priced around the globe and we are
committed to being the industry leader in operational efficiency."
CP Kelco's expanded production capacity in Knowsley compliments the Okmulgee
expansion and the Knowsley site is adding work shifts in response to increased
material demand. "There's a growing demand in the European market
for 'identity preserved' products," Size said. "Our investment
in added production at Knowsley reflects our commitment to the growing
business we have in Europe."
Size added that CP Kelco's original biogums plant in San Diego, California
continues to be an important component of the company's global strategy.
"The San Diego site is critical to our ongoing success. Besides world
scale production of xanthan gum, we utilize our manufacturing technology
and flexibility there to produce a broad array of custom and specialized
products."
About CP Kelco:
CP Kelco is the global leader in the hydrocolloids (thickeners and stabilizers)
market, with leading positions in xanthan gum and pectin and a strong
position in carrageenan. The company has more than 2,000 customers in
over 100 countries, with facilities in North America, Europe, Asia and
Latin America. Formed in 2000 by the combination of the Copenhagen Pectin/Food
Gums Division of Hercules Incorporated and the Kelco Biopolymers business
of Monsanto Company, CP Kelco's principal share-holders are Lehman Brothers
Merchant Banking Partners II L.P. and Hercules Incorporated (NYSE: HPC).
For more information on the company, please visit www.cpkelco.com
CONTACT:
JACK KOBERSTINE
311 S. Wacker Drive, Suite 3700
Chicago, IL 60606
Tel: 1 (312) 554-7813
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