Thai Vinythai plans $238 mln capacity expansion

BANGKOK, Sept 25 (Reuters) - Thailand's Vinythai VNT.BK said on Friday it planned to invest 8 billion baht ($238 million) to raise its capacity in chlorine and caustic soda and invest in an epichlorohydrine (EPI) project.

The country's second largest polyvinyl chloride (PVC) producer would spend 2.25 billion baht on capacity to produce an additional 90,000 tonnes of chlorine and 100,000 tonnes of caustic soda annually to support the EPI project, it said in a statement.

Chlorine and caustic soda are raw materials for EPI, which is used to produce epoxy resin, widely used in the auto and electronics industries.

The company also planned to spend 5.75 billion baht to produce 100,000 tonnes of EPI a year. That included 360 million baht to buy Solvay Biochemicals (Thailand) from Solvay Chemicals and Plastics Holding B.V., which owns 49.99 percent of Vinythai.

About 20 percent of its EPI products will be sold in the domestic market and the rest exported, it said, adding it would use cash and loans to finance the expansion.

The plan is subject to approval from shareholders at a meeting on Nov. 20.

In August, Solvay transfered its 49.99 percent stake in Vinythai to subsidiary Solvay Chemicals as part of a reorganisation of its global business.

Vinythai competes with market leader Thai Plastic and Chemicals PCL TPC.BK, controlled by top industrial conglomerate Siam Cement SCC.BK.

At 0749 GMT, Vinythai shares were up 6.7 percent at 7.15 baht after hitting a 12-month high of 7.40 baht earlier, while the overall market was up 0.22 percent. ($1=33.62 Baht) (Reporting by Khettiya Jittapong; Editing by Alan Raybould)