Du­lux owner in­vests in UK paint re­search

The Malta Business Weekly - - FRONT PAGE -

Ak­zoNo­bel, the com­pany that makes Du­lux and Ham­merite paint, is in­vest­ing €12.6m in a new re­search fa­cil­ity in north-eastern Eng­land.

The firm, known for its Old English sheep­dog mas­cot, is put­ting the money into its R&D site in Felling, Gateshead.

As well as house­hold paint, the firm pro­duces spe­cial­ist coatings for the min­ing and en­ergy in­dus­tries.

Ak­zoNo­bel said Felling was the "log­i­cal spot" for this in­vest­ment.

The new fa­cil­ity will be able to sim­u­late ex­treme en­vi­ron­ments, sim­i­lar to the North Pole or a fire on an oil rig, to test new prod­ucts.

"We are cre­at­ing a kind of a cam­pus of dif­fer­ent re­search and de­vel­op­ment ac­tiv­i­ties and strengths that we can then use for prod­ucts that can be sold in the rest of the world," Ton Buch­ner, Ak­zoNo­bel's chief ex­ec­u­tive, said.

The com­pany al­ready em­ploys 270 peo­ple at its site in Felling. The in­vest­ment in a UK hub, rather than ex­pand­ing re­search fa­cil­i­ties else­where, would safe­guard those jobs.

Re­search will fo­cus on pro­tec­tion to make hy­dro­elec­tric dams last longer, coatings to re­duce emis­sions from coal-fired power plants and in­no­va­tions in fire pro­tec­tion.

A €110m Du­lux paint fac­tory in nearby Ash­ing­ton, Northum­bria, is also about to be­gin pro­duc­tion, the firm said.

Ak­zoNo­bel's chief ex­ec­u­tive, Ton Buch­ner, said that the vote for Brexit was not an ob­sta­cle to fur­ther in­vest­ment in the UK.

The fall in the value of the pound since the EU ref­er­en­dum had "ac­tu­ally made it eas­ier for some of the ex­port­ing of the prod­ucts that are there", he said.

Ak­zoNo­bel is based in Am­s­ter­dam, and re­ports its fi­nan­cial re­sults in euros. The fall in the pound, there­fore, re­duces the amount Ak­zoNo­bel earns from the UK.

But if the pound re­mains weak, then money in­vested into the UK will go fur­ther than in its other ma­jor re­search sites in Sin­ga­pore and the Nether­lands.

How­ever, Mr Buch­ner said prices could rise for some prod­ucts in the UK as a re­sult of the de­val­u­a­tion of the pound.

"There is a pos­si­bil­ity prices are go­ing up in some of the ar­eas where we sell into the market," he said.

The com­pany's most re­cent ac­counts show dec­o­ra­tive paints rev­enue was down 4% in 2016, "mainly due to un­favourable cur­rency ef­fects, in par­tic­u­lar the pound ster­ling and cur­ren­cies in Latin Amer­ica"

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