Essel Propack (EPL), the world's largest manufacturer of laminated tubes, is setting up a manufacturing unit at North Carolina in USA. The company has floated a wholly owned subsidiary, Essel Propack America LLC to set up the unit with an investment of $20 million.

The plant will have a capacity to produce around 500 million laminated tubes per year and is likely to become operational by December 2002. The entire production is to be sold to FMCG major Procter & Gamble under a 5-year supply contract, P&G would be sourcing its entire requirement of laminated tubes for its two oral care products – Crest and Florodent from Essel.

The project, christened Taj, would be have a debt to equity ratio of 1:1. The debt component would be raised from the US market while the equity will be brought in through internal accruals.

According to Cyrus Bagwadia, Managing Director and CEO of Essel Propack, the company aims at acquiring 50 per cent of the global market share by 2005. This is to be achieved by increasing the production capacity to a level of 7 billion tubes per year from the present is 3 billion tubes.

Essel’s current market share is pegged at 25 per cent, which will rise to 30 per cent on completion of US project.

As a part of its expansion, EPL plans to expand capacities at its units in China, Egypt and Latin America. Further, the company is exploring the options of acquisitions in European countries.