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China to ride into Henkel's top five markets

(Agencies)
Updated: 2008-08-25 17:48

Henkel AG & Co KGaA's recent acquisition will help the supplier of detergents and glues, make China one of its five biggest markets by sales in 2010, chief executive officer Kasper Rorsted told Capital Investor in an interview.

The acquisition of National Starch's adhesives and electronic materials businesses for 2.7 billion pounds has strengthened Henkel's Chinese business and helped it to become profitable, he told the magazine.

"We would otherwise not be at this point," he said.

Rorsted does not believe that a "bubble will burst in China", even though its economy is held back by the weakness in the United States, he said.

China's biggest problem is rising inflation, he added.

Asked about rising raw-material costs, the CEO said costs are up 7 percent to 9 percent across all product types, more than the 4 percent to 6 percent expected until recently.

The company has already lifted sales prices for adhesives and detergents but higher mark-ups are needed, Rorsted said.