Alleima is increasing its capacity for application tubing products, such as heat exchanger tubes, through an investment of approximately SEK 250 million in a new cold-finishing facility in Zhenjiang, China.

The greenfield facility will have more than 10,000 sq mt floor space and will be built on the existing Alleima site in Zhenjiang in China. Operations will ramp up from 2025, adding cold-finishing capabilities to meet the growing demand for heat exchangers, composite tubes and other application tubing products, mainly to the Chemical and Petrochemical segment in China. The facility will also have capabilities to produce hydrogen tubes supporting the build-out of Chinese green hydrogen infrastructure.

The chemical and petrochemical segment is one of the targeted segments in Alleima’s profitable growth strategy. The offering consists of a premium portfolio of application tubing products used in chemical plants for production of chemical compounds, which are expected to grow driven by increased global consumption. Alleima had revenues of SEK 3,803 million in Asia, of which SEK 1,744 million in in China during 2022.

“In line with our strategy, we are increasing our capacity to serve the growing market for our application tubing products for the Chemical and Petrochemical segment in China. Today, we are one of the leading players in the premium segment, and as we see an increasing demand driven by the infrastructure expansion of chemical plants, the investment is a key enabler to maintain our position and for continued profitable growth in the region,” says Göran Björkman, President and CEO of Alleima.

The investment will be carried out during a three-year period and capex guidance of approximately SEK 800 million for full year 2023 remains unchanged.