By Sara Webb
AMSTERDAM, Jan 20 (Reuters) - Royal Ten Cate, the Dutch producer of artificial grass and materials used in the defence and aerospace industries, said on Thursday it is on the prowl again for acquisitions and alliances.
Asia is one region ripe for expansion for all of Ten Cate's products: it currently accounts for just 10-15 percent of Ten Cate's annual sales of about 1 billion euros ($1.35 billion), but the target is to raise that to 20-30 percent.
Ten Cate, whose composite materials are used on the wings of the Airbus A380, wants to apply technology used in the aerospace industry to expand in the wind energy, automotive, and oil and gas sectors, said Frank Spaan, investor relations director.
Ten Cate supplies Boeing Co and Airbus, a unit of Europe's EADS; growth has been held back by aircraft production delays, but is now set to accelerate.
"As from the fourth quarter of 2010, and starting this year, it will really take off," Spaan told Reuters, citing fleet renewals and a recovery in air travel.
Ten Cate competes with specialty chemicals and composite materials producers such as U.S.-listed Cytec Industries Inc and Hexcel Corp in supplying composites used in aircraft manufacturing and wants to capitalise on the technology to get into new areas.
By buying suppliers or firms with the relevant composites product range or technology, Ten Cate can generate commercial sales from those sectors in the next two to five years, he said.
Spaan declined to name any possible targets or deal size. The firm last month agreed a 450 million euro syndicated loan.
TURF WAR
Ten Cate, which makes synthetic turf used in Olympic hockey pitches and American National Football League stadiums, this month raised its stake in GreenFields, a FIFA "preferred producer", saying this would give it greater quality control over the turf manufacturing process.
But rather than buy rivals in the field of artificial turf, where it competes with Britain's Low & Bonar plc, it prefers to take stakes or form alliances with marketing firms or those companies which make the "carpet," Spaan said.
"We want to control the production of the system ... in the sports market, branding is much more important, you talk about a Ten Cate field, so we want to control that," he said.
Ten Cate's top product -- Defender M, a heat and flame-resistant fabric used in uniforms worn by the U.S. military in Iraq and Afghanistan -- is set to bolster sales for the next three quarters, the company said this month.
Ten Cate's supplies were put on hold last year when the U.S. military switched to a different camouflage pattern for use in Afghanistan from that used in Iraq. Sales resumed and will hit $60 million in the fourth quarter of 2010, and will be similar in each of the first three quarters of 2011, Spaan said.
"At the moment we have peak sales (for the Defender M fabric to the U.S.), but we face a potential decline if deployment levels go down (in Afghanistan and Iraq), so we have to look for new markets," Spaan said.
Ten Cate, which has a stock market value of about 700 million euros, declined to give a forecast for profit and sales for 2011 or the first quarter. Analysts expect an average net profit of 48.2 million euros on sales of 945 million euros for 2010, rising to almost 60 million euros on sale of 1.03 billion euros this year, according to Thomson Reuters I/B/E/S.
Ten Cate shares were down 3.6 percent on Thursday at 1610 GMT, and are flat this year after a rise of 52 percent in 2010. (Reporting by Sara Webb; Editing by Elaine Hardcastle)