MOSCOW (MRC) -- Argentina's stock regulator has rejected as inadequate an offer from Brazil's Braskem, Latin America's largest petrochemical company, to buy the roughly 30% of the shares of plastic maker Solvay Indupa that are publicly traded, as per Reuters.
Solvay Indupa is the Argentine-Brazilian unit of Belgium's Solvay, which owns 70.59% of the company. Solvay Indupa operates two industrial sites, one in Bahia Blanca, Argentina, and the other in Santo Andre, in Brazil's Sao Paulo state, that produce PVC plastic and caustic soda. The deal would represent Braskem's first move into production in Argentina.
In a contract signed last month, Braskem would buy the stake held by Solvay and buy the remainder of Solvay Indupa on the Buenos Aires stock exchange.
"The offer presented by Braskem of USD1.35 per share is in line neither with the book value of the company, which as of Sept. 30 was USD2.81, nor with average valuations during the fourth quarter of USD3.92," Argentina's CNV market regulator said in a statement.
The publicly traded shares of Solvay Indupa include a 16.7% stake held by Argentina's state pension fund, Anses.
As MRC informed previously, in February 2013, Solvay announced plans to divest its assets in the Argentine petrochemical producer Indupa, as part of a major restructuring and portfolio optimisation at Solvay. The company owns a 69.9% interest in Indupa, while the rest is traded on the Buenos Aires Stock Exchange.
Indupa, with a manufacturing capacity of more than 500,000 tpa of polyvinyl chloride (PVC), runs facilities at Santo Andre, Brazil, and Bahia Blanca, Argentina.
Solvay, with a market share 27%, is the second largest PVC manufacturer in Europe, after Kerling with 29% of the market.
Braskem is a Brazilian petrochemical company headquartered in Sao Paulo. The company is the largest petrochemical company in Latin America and one of the largest in the world. Braskem controls the three largest petrochemical complexes in Brazil, located in the cities of Camacari (Bahia), Maua (Sao Paulo) and Triunfo (Rio Grande do Sul). Besides these three petrochemical complexes, Braskem also controls a complex in Duque de Caxias (Rio de Janeiro).
MRC