Dow Chemical Co. said it has agreed on a deal with Befar Group Co. Ltd. to make a key refrigerant chemical in China, according to Canadian Business.com
The 50-50 joint venture will produce perchloroethylene, a building block for refrigerants used in industrial, automotive, consumer, building and other cooling applications, the Midland, Mich.-based Dow said in a statement.
Dow said the companies will explore development of a new factory in Binzhou, China, that could produce 40 kilotons of perchloroethylene per year with the possibility of doubling production later. The companies estimate that production would begin in 2014, according to the statement.
Specific financial terms were not released. The companies said the deal is subject to government approvals.
Carol Williams, Dow’s president of chemicals and energy, said in the statement that the memorandum of understanding with Befar will help Dow grow in China and also meet the world’s rapidly expanding need for more sustainable product offerings.
Perchloroethlene does not deplete ozone, the company said.