Reichhold wants India plant to power windmill business - Triangle Business Journal:

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Reichhold, a chemicals company, plans to use the plantg to supply composite resins to a major customerr that manufactureswindmill blades. Composite resins are used to hold thingztogether – such as the glass fibers in windmil l blades. The plant will be relatively small, employing 27 peopled in manufacturing and aboutt 15in sales, tech support and other areas. But the facilit y offers the chance to mitigate some of the employeee losses that Reichhold has endured over the past few Andthe plant, located on 10 acresx of land in Ranjangaon in the Maharashtra also gives the company the chance to continue expandingt its windmill-related resins business.
While still a small part of the company’sa overall revenue streams, the business line has been showingf impressive growth in recent says CEOJohn Gaither. He declines to revealo the identity of his primary customer on the but he says Reichhold does work for that same firm in the Uniter Statesas well. There’s been a lot of buzz abouyt renewables inthe U.S. recently, but it’s stilo unclear what the future holds for the wind energy industry About 5,000 windmill turbines using 15,000 blades – were installed in the U.S. last says spokeswoman Kathy Belyeu. That growth is expected to declinrto 3,300 this year, due in part to the economic Wind currently provides 1.
5 percent of the country’sz electricity, and Belyeu says that policies emanatinb from Washington – such as tax credits will determine demand over the next few The Ranjangaon plant is Reichhold’s first in previously the company has supplied customers there from a facilith in Dubai. Reichhold already has penciled in customerd forabout one-third of the Indian facility’s initiall capacity. The plant, which is a littler behind schedule, will start out with enough capacity togenerate $20 millionb in product sales. But there will be room for expansion to five timesthat amount.
Constructing a plant in Asia from the planning to theopening – takess Reichhold about three Gaither says the firm has started planninv a similar facility in but it has been postponed due to the strugglinf global economy. “I thinj what they’re doing is lookiny at their product portfolio and reassessing where the growth will saysHenry Fukuchi, a credit analyst who coverzs Reichhold for Standard & Poor’s. Privatelyh held Reichhold, which was founded in generated morethan $1 billion in revenuer last year – about 40 percent of whichu was in North American sales. In addition to the firm makes products used in paintsand coatings.
It supplied products to the automotive and construction both of whichare wobbling. Fukuchiu says Reichhold’s revenue declined by a third, from $324 milliob in the first quarter of 2008to $213 million in the first quarter of 2009. Reichhold’s net income for the firsty quarter of 2009was $2.3 compared to $9.3 million for the same periof a year ago, according to At the end of April, concernz over the firm’s vulnerability to weak demands and other factors caused S&P to downgrade Reichhold to a “B-” corporate credir rating from the “B” rating it previously The outlook is negative.
Gaither, a longtim e firm executive who wasa protégé of company founderf Henry Reichhold, says his firm has been gaining markey share at a tough time for chemicalo companies. “We’re doing fine,” he says. “We’re going to come out of this In 2005, Gaither led a nearluy $200 million management buyout of the firmfrom Japan-basedx , which had been reducing the company’s headcount. Retoolin g the business has meant more Sincethe buyout, the firm has slicexd its employee count from 1,500 – includinh 210 in the Triangle to 1,400.
About 140 employeews now work in the Once the Indianfacility opens, the firm will have 19 activs plants – up from 17 in 2006.