Building materials group Kingspan says it is moving ahead with plans to build a new €280 million manufacturing facility in Ukraine. It is the biggest manufacturing investment yet promised to Ukraine.
Mike Stenson, a senior Kingspan executive, told a forum on the margins of a Ukraine investment conference in London that construction would begin on the new facility next year, with manufacturing operations set to begin “towards the end of 2025”.
Ukraine’s prime minister Denis Shmyhal, who is London for the Ukraine Recovery Conference at the Intercontinental hotel in the docklands near Canary Wharf, also announced that the investment is going ahead and said the Irish company will receive state support “in accordance with the law”.
[ Ukraine plans for its future even as the war rages onOpens in new window ]
Mr Shmyhal said the investment by Kingspan to build a manufacturing “campus” would create up to 700 jobs. The facility is expected to be located in the west of the country, possibly near the city of Lviv, which is less affected by the war against Russia that has raged mostly in the east and south.
Mr Stenson was formerly Kingspan’s director of innovation before taking over as project manager for the Ukraine development last month. He told a Chatham House briefing in London in advance of the recovery conference that Kingspan has had a team of Ukrainian lawyers, engineers and technical experts working on the project since last September.
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His comments represent confirmation of a project that was first tentatively mooted by Kingspan last summer, just months after Russia’s February 2022 invasion. Kingspan pulled out of the Russian market last April and within months had switched its attention to Ukraine.
Mr Stenson said the facility will serve two purposes for the company. The first is to manufacture insulation and other building materials to export to the eastern European markets in which it already operates, such as Poland. The other is to allow it to directly “participate in Ukraine’s recovery” by making materials to be used in the reconstruction of the country once the war ends.
“We took a view on Ukraine that in anticipation of a better future there postwar, this would be the right place to [invest],” he said. “The bet we are taking is the Ukraine of the future will be western in outlook [in terms of its building standards and regulations].
He said the biggest challenge Kingspan has faced so far is finding suitable sites with services such as water and power already in place. He suggested the country should follow Ireland’s lead by building investment parks of the type that have been favoured over the years by IDA Ireland.
[ Kingspan grew revenue and profit last year despite ‘bumpy’ conditionsOpens in new window ]
“It makes it easier to bring people in from outside to relocate,” he said.
He said Kingspan, which has had a sales presence in Ukraine since 2006, currently believes it will have no difficulty getting insurance for its investment in the country, even though it is at war.
“We’re already in negotiations [for insurance] but we don’t need it yet,” he said.
