Leading chemical company BASF is strengthening its business with polyurethane (PU) customers in the Gulf region, the company said yesterday.

The BASF subsidiary Elastogran and the Kanoo Group have agreed to create a joint venture - Kanoo 51 per cent, BASF/Elastogran 49pc - under the operational lead of Elastogran.

This joint venture will acquire the polyurethane business of Multi Chemical in Abu Dhabi from Al Hamid Group by end of this month.

The joint venture and Al Hamid have agreed to not disclose the purchase price.

The closing of the transaction is subject to approval of the relevant authorities.

With its approximately 20 employees, Multi Chemical achieved as part of the Al Hamid Group a turnover of around $20 million in the PU business last year.

"We are happy to continue and expand our co-operation with BASF into the polyurethane segment offering innovative, valuable and highly customised PU Systems," said Kanoo Group deputy chairman Mishal Hamed Kanoo.

Founded in 1995, the company is one of the leading System Houses in the region.

The partners also plan to construct a new Polyurethane System House in Dubai Industrial City. Construction is expected to start soon. The production of PU systems by the joint venture will be concentrated there as of 2010. -TradeArabia News Service