(Yicai Global) June 11 -- China’s Hengdian Group DMEGC Magnetics, the world’s largest supplier of soft magnetic materials, plans to build a new plant in Vietnam with its Japanese partner Foster Electric to boost product competitiveness and serve nearby customers.

The joint venture project, located in the An Phat 1 Industrial Park in Hai Duong province, will produce 10,000 tons of speaker magnets and magnet tiles a year, Jinhua-based Hengdian said in a statement yesterday.

In the mid-to-long term, the new plant will help boost Hengdian’s competitiveness in the permanent ferrite industry and help the firm serve clients in Hai Duong, where it has a large customer base, and surrounding areas, it said.

The JV has registered capital of USD5 million. Hengdian Group DMEGC Magnetics has an 80.1 percent stake and Tokyo-based Foster Electric owns the rest. No other details, such as the amount of investment, were provided.

Foster Electric mainly manufactures and sells speakers, audio equipment and electronic equipment, according to the statement.

Shares of Hengdian Group DMEGC Magnetics [SHE: 002056] closed down 1.5 percent today at CNY12.4 (USD2). The broader Shenzhen Component Index lost 0.6 percent.

Editor: Peter Thomas