Swiss company TRS SA concludes deal with Chinese firm to secure a strong position in the growing Chinese recycling sector
TRS announces Joint Venture for ELT recycling in China
Tyre Recycling Solutions SA. Switzerland (“TRS”) and Tengzhou SDS Star Smith Metal Products Co., Ltd. (“SDS”) have concluded a joint venture agreement regarding Tyre Recycling Solutions China Jointco, Ltd., (“TRS China”) a consolidated subsidiary of TRS Switzerland. The venture will be established by TRS and SDS, under Chinese laws. The Parties intend to domicile JointCo in Tengzhou Economic Development Zone, Shandong Province, one of the nation’s clusters for the production of tyres. TRS shall be the majority owner with 67 per cent of both the share capital and the voting rights. SDS SubCo shall own the balance of 33 per cent.
China generates about 15 million tons of ELT and the volume is increasing at the rate of 8-10 per cent per year according to the China Tyre Recycling Association (CTRA). Most importantly, China currently produces over 30 per cent of the world’s tyres. About half of its production is exported and, therefore, bears a huge responsibility for environmental consequences. In addition, the country consumes some 85 per cent of the world’s natural rubber and some 30 per cent of the world’s synthetic rubber. China also imports some 70 per cent of natural and synthetic rubber volumes. Recycling waste tyres into a valuable raw material is therefore of strategic interest for the nation.
“We see the opportunity for JointCo to become the leading force in the implementation of green technologies and the model of an inclusive circular economy solution for China. Our goal is to offer performance recycled materials to a variety of key markets such as, for example, tyres and road paving, said Staffan Ahlgren, TRS Switzerland CEO.
“The famous saying coined by Deng Xiaoping, 'crossing the river by feeling the stones', aptly describes the process of pioneering such new forms of business”, said Yang Kaiyu, Managing Director of SDS. “Starting our collaboration with a well thought out plan will enable us to bring to our country a ground-breaking solution and serve the industry’s fast flourishing need for sustainable materials.”
With the start of the joint venture, the TRS China subsidiary will develop a production facility for recycling ELT car and truck tyres starting in Q4 2020, with a target to produce 60,000 tons of TyreXol by year end 2023; the JointCo shall commercialise performance recycled rubber powder produced not only by its own recycling factory, but also produced from any other tyre recycling factory licensed by TRS to produce TyreXol in China.
TRS derives its revenue from equipment sales, licenses and sale of high performance rubber powder under its globally trademarked brand name TyreXolTM . TRS has patented or applied for patents for trs t-cut, trs Water Pulse, trs Biodevulc . The names of these processes and related equipment as well as TyreXol™ and TRS are registered trademarks of TRS in China as well.
Tengzhou Star Smith Metal Products Co., Ltd. is an industrial company which conducts two types of activities: manufacturing variety of steel fibre for concrete reinforcement including recycling and processing of steel cords coming from end of life tyres on the one hand, and manufacturing, installation, development and operation of industrial processes in China with foreign partners on the other hand.