Global insulation products manufacturer Knauf Insulation has announced a €200m (£170m) investment to build a new UK factory.

The new facility will be able to produce more than 100,000 tonnes of rock mineral wool each year once it opens in 2026, the firm said.

A planning application will be submitted once the firm decides on a location.

The move signals Knauf Group’s confidence in the future growth of mineral wool markets in the UK and northern Europe, said Neil Hargreaves, Knauf Insulation’s managing director for Northern Europe.

He said: “The investment represents a step change in the capacity, capability and sustainability of our UK rock mineral wool solutions, while significantly contributing towards Knauf Group’s ambitious sustainability goals.”

The new factory will help Knauf Insulation decarbonise and increase its UK supply of rock mineral wool insulation, the firm said in a statement.

Knauf Insulation operates 28 manufacturing facilities in 15 countries, turning over €15.4bn (£13.2bn) in its last financial year.

The firm was founded in 1979 as a US subsidiary of German building materials giant Knauf Group. The firm employs more than 6,000 people worldwide, including 600 in its three UK manufacturing plants in Cwmbran, Monmouthshire; St Helens, Merseyside; and Queensferry, Flintshire.

Its UK business Knauf Insulation Ltd recorded an 11 per cent sales increase in its most recent audited annual accounts for the 2022 calendar year.

Revenue rose from £210.5m in 2021 to £234.6m the following year.

Pre-tax profit inched upwards, reaching £34.4m compared with £34.3m in 2021.

In the UK firm’s accounts, directors noted challenges from material shortages, high inflation and increasing interest rates.

However, they added that “underlying demand for mineral wool from the construction market remains strong”.

Construction News approached Knauf Insulation for further information on the new factory.