Announcements & News Releases

Investment In Cutting Edged European Membrane Company

Apr 01, 2006

Hyflux Ltd (the "Company") is pleased to announce its acquisition of a 51% equity in CEPAration B.V. of Netherlands for 1,500,000 Euro.

The deal also involves CEPAration B.V, through its wholly owned subsidiary, granting an exclusive licence to the Company to manufacture its cutting-edged ceramic hollow fibre membranes ("Product") globally and an exclusive right to market and to sell the Product worldwide except Europe. For this licence, the Company will pay an upfront royalty and a running royalty based on the annual net sales of the Product.

Following the investment, CEPAration B.V. will focus on research and development, pilot production and sourcing Products from the Company for sales in Europe.

CEPAration B.V. is a spin-off from a leading Dutch technology institute, Netherlands Organisation for Applied Scientific Research ("TNO"). Incorporated in 2001, CEPAration B.V. is involved in the research, development, production and sales of ceramic membranes used in liquid and in gas separation. It is one of the few manufacturers of ceramic membranes in the world. The differentiating features of CEPAration B.V.'s products are their high technology content, compactness and low cost.

TNO, a shareholder of CEPAration B.V., was established by law in 1930 to support the public and the private sectors with innovation and research and development. Its activities are focused on 5 core areas: (1) quality of life, (2) defence, security and safety, (3) science and industry, (4) environment and geosciences and (5) information and communication.

Ceramic membranes are known for their resilience and durability even under highly demanding separation conditions. They can operate within a wide range of chemical, mechanical and thermal limits. Hence they excel in applications involving extreme processes such as the use of high temperature or pressure or aggressive solvents. These applications include treatment of oily water, recovery of heavy metals, clarification of fruit juices and other beverages, bioreactor for biodegradeable effluent and separation, purification and concentration of enzymes, antibiotic, organic acids, proteins, amino acids, vitamins and pharmaceutical products.

Commenting on the investment, Ms Olivia Lum, Group CEO and President, said, "We are excited with this investment. CEPAration B.V.'s products and manufacturing process are state-of-the-art. With this tie up, we will be able to strengthen our membrane manufacturing and R&D capabilities by leveraging on the established R&D competencies of CEPAration B.V. and its shareholder, TNO."

Commenting on how ceramic membrane will complement the Group's existing membrane offerings, Ms Lum said, "With the addition of ceramic membranes to our product line of polymeric hollow fibre membranes, we will now be able to provide a comprehensive range of polymeric, stainless steel and ceramic membranes for various pretreatment liquid separation applications. These include applications in the pharmaceuticals, biotechnology, oil and gas, petrochemical and food and beverage industries."

On the sales front, Ms Lum added, "In addition, our marketing territory is now expanded to Europe through CEPAration B.V. Hence this investment will sustain our growth momentum by creating new and more lucrative opportunities for us not only in our EPC (Engineering, Procurement and Construction) business but also in the supply of membrane modules and systems, particularly to our industrial customers. It also sits nicely with our growth strategy as we expand our marketing presence in China, India, Southeast Asia, the Middle East and now Europe."