BioAmber and CJ CheilJedang Plan JV for Succinic Acid Production in Asia
MONTREAL - BioAmber Inc. has signed a non-binding letter of intent with South Korean-based CJ CheilJedang Corp. (CJCJ). Under the terms of the agreement, BioAmber and CJCJ plan to establish a joint venture (JV) in China to produce up to 36,000 metric tons of bio-succinic acid annually and commercialize the output in Asia.
The goal is to competitively produce bio-succinic acid in China and quickly penetrate the world's largest succinic acid market. This can be achieved rapidly, cost effectively and with limited capital investment by retrofitting an existing CJCJ fermentation facility with BioAmber's succinic acid technology. CJCJ would incur all capital costs required to retrofit its fermentation facility, including the capital needed during plant commissioning and startup, and production would begin in the first quarter of 2018. If market demand was to subsequently exceed production capacity, the JV could expand production through debottlenecking or additional investment. The partners would also have a mutual right-of-first-refusal to retrofit additional CJCJ fermentation facilities globally.