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Taiwan Province of China : EXPANSION funds gained by FPG unit

July 24, 2014

A syndicated loan agreement is signed by State-run Mega International Commercial Bank with Formosa Industries Corp (????), a unit of the Formosa Plastics Group (FPG, ????), intended at deepening the latter s business in Vietnam.

Mega Bank said in a statement said that the banking subsidiary of Mega Financial Holding Co (????) will work as the lead bank in the loan, with Japan s Sumitomo Mitsui Banking Corp, Mizuho Bank and Bank of Tokyo-Mitsubishi UFJ also participating in the syndicated loan valued at US$210 million (NT$6.31 billion).

The statement said that all parties included signed the agreement in Vietnam s Dong Nai Province, where the headquarters office of Formosa Industries is located.

The move marks the first business expansion by a Taiwanese firm in Vietnam since violent anti-China protests erupted there earlier this year, damaging multiple foreign companies facilities, including some Taiwanese ones. Mega Bank s statement said that Formosa Industries manufactures polystyrene used in home appliances and electronics in the Southeast Asian country and the FPG has invested up to US$1.3 billion to expand its manufacturing capacity there since 2001.

It added that demand for the material is strong as more downstream companies move to ASEAN countries for their lower labor costs and fast economic growth.

The statement said that Formosa Industries plans to strengthen its capacity with an extra US$250 million and the benefits of this investment are expected to become evident later this year and the next.

In a statement the manufacturer said that it had applied for a loan of US$157 million, but the banks decided to give it more given the FPG s healthy credit history.

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Source: TendersInfo (India)

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