Essentra inks Chinese JV deal

Essential components provider Essentra has inked a Chinese joint venture deal that will see the firm help develop next-generation filters.

Essentra, along with China Tobacco Fujian Industrial, Shanghai Haiyan Investment Management, China Tobacco Hunan Investment Management and China Tobacco Guangxi Tiancheng Management will work on the filters in a state-of-the-art development and testing centre.

The JV plans to manufacture locally in a new facility in Xiamen following formal approval from relevant regulatory authorities in accordance with the Tobacco Monopoly Law of the People's Republic of China.

Essentra will make an investment of about £8m. Construction and fit-out of the new plant and machinery was projected to begin during the first quarter of 2020, while shipment of first production volumes to local customers was expected to take place in November 2020, at the earliest.

Chief executive Paul Forman said: "I am very pleased to secure this particular strategic 'game-changer' for filters.

"The JV's onshore development and testing facility, together with local production, will enable us to work ever more closely with our partners in China to provide innovative special filter solutions."

As of 0900 GMT, Essentra shares had inched back 0.33% to 425.60p.