US-based Valmont Industries Inc, the world's leading supplier of mechanized poles, towers and structures for lighting, traffic, utilities and communications, yesterday opened a design and manufacturing plant in the Pearl River Delta city of Heshan in Guangdong Province.

The new facility, Valmont's largest investment project in China, will manufacture and market road lighting poles, wireless communication poles and utility poles for power transmission and substations.

With a total investment of 300 million yuan (US$37.5 million), the Heshan plant is expected to rake in an annual sales turnover of over 400 million yuan (US$50 million) when it is fully operational in two years.

"We never doubted that China has the largest infrastructure market and our new facility is expected to better meet the growing local market demand in the Pearl River Delta, in Guangdong and in South China," said Mogens Bay, Valmont's chairman and CEO.

Valmont's initial annual production capacity is set at 40,000 tons of mechanized poles, 70 per cent of which are for the local market and the remaining 30 per cent of which are for overseas markets.

Bay said the company is opening the new facility at the right time and in the right place to tap the potential of China's rapidly growing infrastructure and the Pearl River Delta's flourishing economic development.

Over 40 per cent of Valmont's business in China is done in the south, primarily in Guangdong, he said.

"We will look for investment opportunities in northern and central China, or elsewhere, to keep close to our customers; and we will continue to pour significant investment into marketing and sales," he said.

Bay said that while the company would prefer sole ownership of any future facilities it establishes in China, it would not rule out the possibility of acquiring factories provided they are the right cultural and technological fit.

Valmont set up its first design and manufacturing facility in Shanghai in 1995, with its first light pole rolled off the production line in early 1996.

Its Shanghai facility has the capacity to produce over 100,000 poles annually.

Huang Xiaoyong, general manager of Valmont Industries (China) Ltd and Valmont Industries (Guangdong) Ltd, said the new facility, together with the existing one in Shanghai, has made Valmont the biggest supplier of mechanized poles in China.

Huang said state-of-the-art manufacturing equipment, technology-intensive raw materials and processing would give the firm a competitive edge that would enable it to expand its presence in China, particularly in the high-end market.

He said Valmont China aimed to account for 20 per cent of the firm's total global business in the next 10 to 20 years.

Its business in China currently makes up 5 per cent of Valmont's total.

Valmont currently operates 43 facilities in 14 countries around the world. Its sales volume was US$1.1 billion in 2005.

Editor: Yan