$21M polymer-based product manufacturing operation to be set up in WA

6/9/95

A $21 million polymer based product manufacturing and marketing operation is to be established in Western Australia as a result of support from the State Government.

The operation will be established in Perth by Dunlop Skega, a partnership between Australia's Pacific Dunlop and Skega AB of Sweden, to make mill linings for the mineral processing industry both in Australasia and in the Asian region.

"The establishment of the WA operation involves a major relocation for the company from Victoria," Commerce and Trade Minister Hendy Cowan said today.

"Up till now, the manufacture of polymer based products has all been done on the eastern seaboard, and the products were transported into WA.

"Dunlop Skega sells its product into WA, where there are now no manufacturers of rubber mill linings.  Locating here will enable the partnership to better service existing customers in their region and pursue new export markets."

Dunlop Skega manufactures and markets its products for the mining industry throughout Australia, New Zealand, Papua New Guinea and South East Asia.

Mr Cowan said the company's regional headquarters and manufacturing plant were currently located in Melbourne.

"The Government offered the company a relocation package to move its regional headquarters and manufacturing plant to Western Australia," he said.

"The package consists of a $1.5 million interest-free loan which would convert to a grant after 10 years if certain performance criteria were met by the partnership.

"The State would expect to recover its financial incentive from direct revenue return in about nine years.

"The support is being given under the Department of Commerce and Trade's Locate to Western Australia program, which has already brought several companies to WA, mainly in the oil and gas industries, with significant economic benefits to the State."

Dunlop Skega is owned 50 50 by Australia's Pacific Dunlop and Skega AB of Sweden. Dunlop Skega makes and markets Skega polymer based products, for wear protection of process equipment, throughout Australasia and South East Asia.

Its main product range is rubber and composite mill linings for use in the mining industry. It lists major Australian mining operations among its customers.

Mr Cowan said the company would build a state of the art facility in Perth. It was expected to increase its WA workforce from 11 people to 41 next year, with a further increase to 55 by the year 2000.

"Dunlop Skega sees the relocation as a strategic move to take advantage of Perth's proximity to its Asian market.  The partnership envisages a seven per cent rate of growth in the South East Asian mineral processing industry," he said.

"Its existing clientele in WA is serviced by a local sales team. Skega has established operations throughout South East Asia.

"It will maintain its ongoing research and development after it sets up here and will liaise with local tertiary institutions to progress research and development initiatives.

"The investment will be responsible  not only for establishing a complete regional headquarters in Perth to service the Australasian and Asian regions, but also provide the opportunity to attract investment from two major organisations, Pacific Dunlop and Skega AB."

This initiative would create direct employment, have multiplier effects in support and service organisations, and also provide a focus in WA for two major organisations.

Media contact: Peter Jackson 222 9595