(Yicai) Dec. 11 -- Shares of Mesnac advanced after the Chinese supplier of rubber processing machinery unveiled a plan to build a new factory in Mexico for USD20 million.

Mesnac [SHE: 002073] closed 2.3 percent up at CNY8.87 (USD1.22) in Shenzhen today.

The plant, which will be located in León, Mexico, will be built and operated by Mesnac’s subsidiary registered in Hong Kong, the Qingdao-based parent company announced yesterday. No more details about the project were disclosed.

Mexico is an important base for tire manufacturing, so establishing a local presence can help Mesnac better meet the needs of its North American customers, as well as enhance its ability to bypass international trade barriers, the firm noted.

Mesnac has been actively expanding overseas this year. In June, it said it planned to build two mold production facilities in Vietnam and Cambodia.

Mesnac researches and manufactures rubber processing equipment and systems. It offers tire manufacturers a comprehensive range of smart tire rubber machinery products and system software services.

According to the company’s semiannual earnings report, nearly 68 percent of its revenue came from the rubber processing equipment business and about 32 percent from the rubber new materials business. Overseas sales accounted for one-fifth of the total.

Also Mesnac’s affiliate company Sailun Tires is promoting its overseas expansion. Since December last year, it announced plans to build new factories in Cambodia, Indonesia, and Mexico.

Editor: Futura Costaglione