LONDON (ShareCast) - Specialist plastics and foam-maker Zotefoams has set up a sales and manufacturing joint venture with one of Japan’s largest chemicals companies.

Inoac Corporation, the world’s leading foams producer, has signed two 50/50-owned joint venture (JV) agreements, one to sell Zotefoams’ UK-made Azote-brand products in Asia and Australasia, and the other to build a new plant in South Korea and manufacture Azote products there.

Inoac, which has been a Zotefoams customer for a number of years, said it was impressed by the technological advantages of the Azote range of cross-linked polyolefin foam products.

From July 1st, the sales joint venture will market products manufactured at Zotefoams' Croydon site in the UK and shipped direct to the JV’s customers in Asia and Australasia.

The manufacturing JV will see the parties jointly invest $8.0m in a new factory in South Korea, next door to an existing Inoac site, ready to begin producing in 2015.

Using its existing cash facilities, Zotefoams said its initial capital contribution, which is to be matched by Inoac, was $300,000 to the sales JV and $500,000 to the manufacturing JV, with a further $1.4m to the latter around the end of 2014.

Managing Director of Zotefoams David Stirling said: "Demand for our Azote polyolefin products in Asia is growing and this joint venture demonstrates our commitment to develop this market.”

Shares in Zotefoams were up 0.2% to 206p at 13:40 on Friday.

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