Lanxess to launch Russian sales, distribution arm

Cologne, Germany -- Lanxess AG plans to build its presence in Russia by implementing a company there in the beginning of 2009.

The first step for the rubber and chemicals manufacturer will be to open a Moscow branch and develop a platform for further involvement in Commonwealth of Independent States nations. There are no immediate plans to construct a manufacturing plant in Russia.

The Russian chemical market is growing at a rate in excess of 5 percent, Lanxess said, and demand is especially high for high-tech rubbers, rubber chemicals and ion exchange resins. The company expects positive growth in Russia in several key markets, including automotive (9 percent annually), electrical and electronics (5 percent) and construction (8 percent).

Axel Heitmann, chairman of Lanxess' board of management, said 20-percent annual sales growth in the Russian market is a realistic prospect. "We plan to derive significant benefit from the expansion," he said. "We have identified substantial development potential for Lanxess and will systematically enlarge our market shares."

Since its spinoff from Bayer AG in 2005, Lanxess has emphasised expansion into the high-potential "BRIC" countries -- Brazil, Russia, India and China. The company already has begun growth projects in Brazil, India and China.

The new Moscow-based company will being operations Jan. 1.

Lanxess announced the decision to expand into Russia during its third annual Media Day event, held Sept. 17 in Cologne. The company, which is based in nearby Leverkusen, plans to establish a new headquarters in Cologne by 2011.

From Rubber & Plastics Newss (A Crain publication)

Presentation by Axel Heitmann on Lanxess website