WELLINGTON, Mar 12 (Xinhua): New Zealand stainless steel equipment-maker NDA Engineering is paying millions of dollars to buy and expand a company in Shanghai, a big step to China's vast market.
NDA said the decision was a direct result of clients' urge to develop a manufacturing capability in China.
"The objective is to grow revenue by supplying customers' needs not currently supplied by the group," said NDA.
The move by NDA, which has Fonterra, New Zealand dairy giant, as a major client, follows its recent decision to invest 153 million NZ dollars (107 million US dollars) to purchase 43 per cent of Chinese dairy company Sanlu.
NDA leader Mollard said Fonterra wasn't one of the firms pushing for NDA to set up in China but "now that Fonterra are there, we're keen to be able to help them with their objectives in China."
NDA, with annual revenues of around 50 million NZ dollars (35 million US dollars) and 320 staff in plants and joint ventures in Australia, already supplies Fonterra with a wide range of equipment.
The company said it would invest further in China by moving the factory later in the year to an 8,000 square meter-facility in Shanghai, doubling its existing floor space.
The Chinese operation being bought by NDA has 75 staff, which will increase in the new factory. The company already supplies many multinationals in China.
NDA is buying the factory, known as Shanghai NDA Stainless Equipment Limited, from Carlisle Process Systems, a subsidiary of US-listed Carlisle Corporation. Carlisle and NDA have worked together previously in Australia and New Zealand.
Mollard said the parties to the deal were keeping the price paid for the Chinese company confidential but it is understood the deal involved millions of dollars.
He said the purchase wasn't a big one in terms of increasing NDA 's productive capacity but "for a little business like ours to acquire something in China is a big move.