Joint venture:casestudy on Sythenia and Vietchem

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SYNTHENIA was considering the opportunity to get involved in a joint venture with the group VIETCHEM of Vietnam for setting up of a polymer plant in Vietnam because his chemical division is facing serious difficulties in Europe due to competition from Japan and the third world. These polymers are the basic components for glues dedicated to bond, textile, wood, plaster, non woven products (such as baby diapers…) paper, cardboard, buiding industry products.

The Companies

1) Synthenia
SYNTHENIA is one of the largest chemical groups in France, operating in various product lines. (Basic chemicals, fine chemical, pharmaceuticals, textiles, agro-chemical and fibers).

– They are since about 10 years working in the Asian area thru either agents or distributors but without any direct investment.

– The polymer division had developed recently a new process of polymerization named the “Continuous process”. This new process is better than the“Discontinuous process”; it offers the advantage of being less labour intensiveand more productive.

– The new plant will offered a capacity of 20 000 tons/years for a total cost of 12Millions EUR

2) VIETCHEM group
This group belongs to Mr Bichlien who is one of the few magnates in
VIETNAM. His core business is the distribution of chemicals in VIETNAM but also in Singapore and Indonesia He controls approximately 40% of the Vietnamese market and owns and controls more than 15 companies, some of them with foreign partners.
This company is managed through various members of the family of Mr.Bichlien. VIETCHEM group cannot speak English but has also an interesting relationships network with the Chinese Diaspora and some PRC officials.
The environment
1) VIETNAM
The total Vietnamese population is estimated around 90 millions, 3 millions of whom are living in Hanoi and 9 millions in Hochiminville. Among them, around 12 millions of the population are working in industry or industrially-related jobs.

Buddhism is the major religion, but the influence of Confucianism, more materialistic, modern and pragmatic, is increasing in industrial and urban contexts.

 

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