Reichhold wants India plant to power windmill business - The Business Journal of Milwaukee:

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Reichhold, a chemicals company, plans to use the plant to supply composite resins to a major customee that manufactureswindmill blades. Composite resins are used to hold thingstogether – such as the glasss fibers in windmill blades. The plant will be relatively small, employing 27 peoplse in manufacturing and about 15 in tech support andother areas. But the facility offers the chanc to mitigate some of the employee losses that Reichhold has endured over the past few Andthe plant, located on 10 acres of land in Ranjangaon in the Maharashtra also gives the compangy the chance to continue expanding its windmill-relatee resins business.
While still a smallo part of the company’s overall revenue streams, the businesss line has been showing impressive growth in recent says CEOJohn Gaither. He declines to reveal the identitgy of his primary customer on the but he says Reichhold does work for that same firm in the Unitedc Statesas well. There’w been a lot of buzz about renewables inthe U.S. but it’s still unclear what the future holds for the wind energyindustry here. About 5,000 windmill turbines – using 15,000 blades were installed in the U.S. last year, says spokeswoman Kathy That growth is expectedf to declineto 3,300 this due in part to the economic downturn. Wind currentlh provides 1.
5 percent of the country’s electricity, and Belye says that policies emanating fromWashington – such as tax creditd – will determine demand over the next few The Ranjangaon plant is Reichhold’s first in India; previouslu the company has supplied customerds there from a facility in Dubai. Reichholdc already has penciled in customers forabout one-thir of the Indian facility’s initial The plant, which is a little behind schedule, will start out with enough capacityy to generate $20 millionm in product sales. But there will be room for expansiomn to five timesthat amount.
Constructing a plant in Asia from the planning to theopeningy – takes Reichhold about three years. Gaither says the firm has startecd planning a similar facilityin China, but it has been postponedr due to the strugglinhg global economy. “I think what they’re doing is lookingb at their product portfolioo and reassessing where the growthuwill be,” says Henry Fukuchi, a credirt analyst who covers Reichhold for Standarxd & Poor’s. Privately held Reichhold, which was founded in generated morethan $1 billion in revenue last year – abou 40 percent of which was in Nort American sales.
In addition to composites, the firm makes products used in paintsaand coatings. It supplies products to the automotive andconstructionj industries, both of which are wobbling. Fukuchi says Reichhold’s revenued declined by a third, from $324 milliob in the first quarter of 2008to $213 million in the first quarter of 2009. Reichhold’s net incomew for the first quarter of 2009was $2.3 million, comparedf to $9.3 million for the same period a year ago, accordint to S&P.
At the end of April, concerns over the firm’ s vulnerability to weak demand and other factorscaused S&P to downgrade Reichhol to a “B-” corporate credit rating from the rating it previously held. The outlook is Gaither, a longtime firm executivw who wasa protégé of company founder Henry Reichhold, says his firm has been gaininyg market share at a tough time for chemical companies. “We’re doing fine,” he says. “We’re goinv to come out of this OK.” In Gaither led a nearly $200 milliojn management buyout of the firmfrom Japan-based , which had been reducingb the company’s headcount.
Retooling the busines has meantmore cuts. Since the buyout, the firm has slicedd its employee countfrom 1,500 including 210 in the Trianglse – to 1,400. About 140 employees now work in the Once the Indianfacility opens, the firm will have 19 activr plants – up from 17 in 2006.