Leading Japanese fibre makers Asahi Kasei Corp and Teijin Ltd announced on Wednesday a deal to set up a joint venture next month to manufacture and sell a next generation fibre.

Based in Osaka, the new firm will be capitalised at 250 million yen and will produce polytrimethylene terephthalate, or PTT, a fibre which has the qualities of nylon and polyester.

In a statement, the two companies said they are hoping the new venture will generate sales of one billion yen in fiscal 2002 and 10 billion yen in fiscal 2006.