The Management Board of Ciech S.A. informs that on February 9th, 2010, the representatives of Ciech Chemical Group agreed the terms and conditions of supplies of amine (TDA) to the subsidiary ZCh Zachem SA in Bydgoszcz with the American Air Products Group.
The amine will be used to the production of TDI (toluene diisocyanate), a component used, for example, in the production of polyurethane foams used in the furniture industry and automotive industry, as well as in the production of insulation materials and varnishes. Zachem is the only TDI manufacturer in Poland.
The annual value of TDI supplies provided by Air Products is estimated at approximately USD 80 million, and the total value of the contract will account for USD 500 million, exceeding 10% of the Issuer’s own capital. Due to the new cooperation terms and conditions, supplies to Zachem will be provided in a continuous way ensuring the stability of deliveries of high quality materials to the Bydgoszcz company. Considering the reconstruction of the demand in the TDI market, the Company expects that the cooperation will contribute to the increase in the effectiveness of production of the main Zachem’s product, positively affecting the Group’s results in the coming years.
The contract, which will be effective from January 1st, 2012 to December 31st, 2018, will guarantee supplies of the raw material according to the Company’s demand. The contract is a renegotiated version of the contract dated October 25th, 2007 (current report no. 67/2007) regarding the cooperation with Air Products Group involving TDA supplies.