Japanese interior materials maker Toli allies with Chinese peer to expand domestic sales, exports
TOKYO, NNA - Japanese interior materials maker Toli Corp. has agreed to invest in a Chinese sector peer to enhance local production of vinyl floor tiles in China to take advantage of lower costs for local sales and exports.
Toli will send staff to Jiangsu Changlong Decorative Material Technical Co. to provide technical expertise for efficient production and quality control before committing $11.22 million to the partner as early as 2023, and taking a 33.4 percent stake, Koro Kato, general manager of Toli’s management planning department, told NNA on Monday.
The share purchase will reduce the current full ownership of Hong Kong-based Global Affluence International Ltd. in the Chinese company to 66.6 percent, Toli said in a statement on Friday.
Toli, which currently exports vinyl floor tiles from Japan to China, expects the potential deal to help improve the cost-competitiveness of such products for sale in the Chinese market, Kato said. “We aim to produce and sell the products locally.”
Vinyl floor tiles are used for commercial facilities and residential apartments.
Toli is also looking at exports of the cost-competitive Chinese-made interior materials for Southeast Asian countries, even to the United States in the future. “We’re seeing demand (for the products) growing because vinyl floor tiles are inexpensive,” he added. Kato declined to discuss sales targets.
Toli currently relies on the Japanese market for the sale of interior materials. The company generates only 2 to 3 percent of its total revenue from overseas, mainly China, Kato said.
The Japanese interior materials maker opened a Singapore branch in November 2019 to further penetrate the Southeast Asian market. It has teamed up with local sales agencies in almost all countries in the region, including Indonesia, the Philippines, and Thailand, mainly for sales of carpets for offices, airports, hospitals, and other large-scale facilities.
Jiangsu Changlong Decorative Material Technical was established in 2017 with a capital of $33.58 million.