Kossan Rubber Industries Bhd. (Malaysia; listing KOSSAN) said it has signed a memorandum of understanding (MOU) for its rubber bearing division to work with two other companies, with an eye toward manufacturing isolation bearings in Iran.

The company has reportedly allocated MYR 50 million (USD $15 million) in its 3-year expansion program, which includes such diversification measures.

Kossan is the world's third-largest producer of powder-free gloves and surgical gloves, with about 7% of the world market. Annual capacity currently stands at 8.5 billion gloves. It is targeting 10% global market share by 2010.

Gloves account for 85% of the company's total revenue; 15% is technical rubber products: molded seals, bearings, and bearings bonded with other materials.

Key among the company's seals and bearings are products for automotive and industrial applications ranging to pipe seals and gaskets, construction, marine, civil engineering, waterstop, compression seals, bearing pads, bridge bearings, bonded metal/rubber bearings, suspension bushings, and complete bonded bearing/roller assemblies used in production of steel, wood, textiles, and similar large industrial systems.

The MOU is between Doshin Rubber Products (a Kossan division), Amona International Ventures, and Kohrang Industrial Group.

Amona is a Malaysian property developer active in Iran. Kohrang, a domestic Iranian company, produces industrial and marine rubber products, including bearings.

Doshin's arrangement with Amona and Kohrang is for them to collaborate in the manufacturing bonded seismic bearings, targeting sales into Iran's booming building construction sector. In particular, seismic isolation bearings are widely used in large government-funded building projects, the fastest-growing construction sector in Iran.