Evonik seeks shareholder permission to issue stock for M&A deals

MOSCOW (MRC) - Evonik will ask shareholders' permission to issue up to one quarter of its current equity capital in new shares over the next five years, as the German chemicals maker scans the market for takeover targets, said Reuters.

Chief Executive Klaus Engel said last month that larger takeovers were an option for the maker of feed additives, clear acrylic sheet and high-tech plastics.

Based on the current share price, a 25% stake would be worth 3.3 billion euros (USD45.2 billion) but a capital increase is typically priced at a discount to the trading price.

Since Evonik was debt free at the end of last year, it would have considerable leeway to take out additional bonds or loans for any merger deal.

If given the green light by investors, the permission to raise capital would be valid until May 2019, the invitation to shareholders for the May 20 annual general meeting showed.

Any capital increase would require the consent of the supervisory board.

The new shares could be issued against cash but could also be used as currency to be offered to shareholders of any merger partner, the invitation said.

As MRC informed before, Evonik Industries is paving the way for a new technology whose applications include automotive finishes that are more scratch-resistant than ever before. The specialty chemicals company has developed an industrial-scale method for producing silane-modified binders for automotive finishes. The advantage of these silane-modified binders: silane groups increase crosslinking density, making it possible to create automotive finishes that are flexible yet harder, leading to improved scratch resistance.

Evonik, the creative industrial group from Germany, is one of the world leaders in specialty chemicals. Its activities focus on the key megatrends health, nutrition, resource efficiency and globalization. In fiscal 2013 more than 33,500 employees generated sales of around EUR12.9 billion and an operating profit (adjusted EBITDA) of about EUR2.0 billion. Evonik is 68%-owned by the RAG foundation, a public sector trust that will finance the cost of maintaining Germany's abandoned coal mines. Buyout firm CVC holds an 18%stake.
MRC

MOSCOW (MRC) -- Borealis and Borouge, leading providers of innovative, value-creating plastics solutions, have developed important material solutions to address specific challenges faced by the global automotive industry, said Yourindustrynews.

At the VDI International Congress "Plastics in Automotive Engineering" in Mannheim, Germany taking place on April 2-3, Borealis will highlight an innovative Fibremod solution developed for the Jaguar F-Type model in close cooperation with Draxlmaier, the Tier One supplier. Other important product innovations in surface aesthetics will also be showcased, with focus on tiger stripe-free surfaces, moulded in colour and primerless two-layer paintability. Material solutions offered by Borealis and Borouge help automotive manufacturers achieve defect-free surfaces while at the same time capitalising on the benefits of lower production and system costs as well as reduced environmental impact, by way of overall vehicle weight reduction and optimised cycle times.

The Fibremod family of engineered short (SGF) and long glass fibre (LGF) compounds was officially launched in September 2013. Fibremod stands for both the name of a material category as well as the ability of Borealis and Borouge to transform or modify a specific grade to fit and exceed the needs and requirements of its customers. Borealis' proprietary LGF process technology makes it possible to tailor highly engineered polypropylene (PP) grades in order to meet the unique challenges of individual customer projects.

"Fibremod innovations support our partners and customers along the entire automotive value chain in their efforts to make vehicles lighter, reduce processing temperatures and energy requirements, all while reducing system costs," explains Jost Eric Laumeyer, Borealis Global Marketing Manager Engineering Applications. "Our customised glass fibre reinforced PP solutions are at the cutting edge of innovation, bringing lightweight, extra strength and impact performance to a wide range of automotive and appliance applications."

We remind that Borealis and Borouge announced the dedicated roll-out of the technology platform Borlink in Russia. Borlink was introduced by Borealis and Borouge as a technology platform offering a complete global package of power cable compounds and expertise serving applications for medium and high voltage (MV, HV), including extra high voltage (EHV) and high voltage direct current (HVDC).

Borouge is a joint venture between the Abu Dhabi National Oil Company (ADNOC), one of the world’s major oil and gas companies, and Austria based Borealis, a leading provider of chemical and innovative plastics solutions, Borouge is a groundbreaking at the forefront of the next generation of plastics innovation.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. Borealis is headquartered in Vienna, Austria, and operates in over 120 countries with around 5,300 employees worldwide.
MRC

MOSCOW (MRC) -- Formosa Plastics Corp (FPC) is in plans to restart an ethylene vinyl acetate (EVA) plant, reported Apic-online.

A Polymerupdate source in Taiwan informed that the plant is planned to be restarted on April 26, 2014. It was shut in end-March 2014 for maintenance turnaround.

Located in Mailiao, Taiwan, the plant has a production capacity of 200,000 mt/year.

As MRC informed earlier, Formosa Plastics is seeking United States permits for a USD2 billion expansion of its Texas operations as cheaper natural gas prices make US production more competitive. The company asked federal and state environmental regulators to approve plans for an ethane cracker unit and downstream derivatives. The investment is bigger than was previously planned by Formosa Plastics as of February 2012, when it said it would spend USD1.7 billion to build two factories and a polyethylene plastics plant in Texas.

Formosa Plastics Corporation is a Taiwanese company based in Taiwan that primarily produces polyvinyl chloride (PVC) resins and other intermediate plastic products.
MRC

MOSCOW (MRC) -- Petronas Chemical Group Bhd (PCG) and German chemical giant BASF will begin construction of a RM1.63 billion integrated aroma ingredient plant in Kuantan by the end of the month, said Freemalaysiatoday.

A source familiar with the deal said a ground-breaking ceremony is scheduled for April 10, with Prime Minister Mohd Najib Razak attending. Plans for the joint venture plant was announced in April last year.

The partners are also to invest in downstream production, including L-menthol-ingredient in numerous products in oral care, body care, flavourings and pharmaceutical products, as well as a plant for citronellol — used for a fresh long-lasting rose fragrance and an indispensable component for many fresh-floral compounds.

All the projects will be located in BASF-Petronas Chemicals Sdn Bhd’s existing JV site in Gebeng, Kuantan.
The BASF-PCG JV company has invested more than RM3.4 billion in the Gebeng plant so far, mainly for acrylic monomers, oxo-products and butanediol production facilities.

Production will be developed in phases, with the first plants of the project operational in 2016, creating some 110 jobs.

Aroma ingredients are sold to the flavour and fragrance industry, and are used mainly in homes and personal care products and fine fragrances, as well as in the food industry and in pharmaceutical applications.

BASF and PCG founded their JV BASF Petronas Chemicals in 1997, and currently operate an integrated complex situated at the Gebeng Industrial Zone, Pahang.

The company’s share capital is 60% held by BASF and 40% by PCG with a total initial investment of about RM3.4 billion for acrylic monomers, oxo products and butanediol production facilities.

The new aroma ingredients plant’s ground-breaking also came 15 months after BASF and Petroliam Nasional Bhd (Petronas) had terminated their speciality chemicals venture within Petronas’ Refinery & Petrochemical Integrated Development (Rapid) project in Pengerang, Johor.

Both companies terminated the heads of agreements signed in March 2012, as "both parties were unable to come to an agreement on the terms and conditions for the implementation of the proposed venture." The agreement then was to jointly own, develop, construct and operate production facilities for a host of specialty chemical products in Rapid.

Petronas, short for Petroliam Nasional Berhad, is a Malaysian oil and gas company wholly owned by the Government of Malaysia. The Group is engaged in a wide spectrum of petroleum activities, including upstream exploration and production of oil and gas to downstream oil refining; marketing and distribution of petroleum products; trading; gas processing and liquefaction; gas transmission pipeline network operations; marketing of liquefied natural gas; petrochemical manufacturing and marketing; shipping; automotive engineering; and property investment.

BASF is the world’s leading chemical company. Its portfolio ranges from chemicals, plastics, performance products and crop protection products to oil and gas. BASF had sales of about EUR74 billion in 2013 and over 112,000 employees as of the end of the year.
MRC

MOSCOW (MRC) -- China has advised its domestic companies to file applications for a renewal of anti-dumping investigation into a type of synthetic rubber imported from South Korea, Japan and Russia, a step that could lead to extension of five-year duties against the rubber chemical, as per GV with reference to Yonhap News Agency.

Unless no applications were received for 60 days from 7 March, the anti-dumping duties against styrene-butadiene rubber imported from the three nations would be terminated on 8 Sept. this year, China's commerce ministry said in a statement.

China has levied anti-dumping duties on the rubber chemical, a material used for producing tires and a range of consumer goods, imported from the three nations since 7 Sept. 2009.

After reviewing the situation of the domestic industry over the past five years, the Chinese ministry said, "The termination of anti-dumping duties is likely to lead to continuation of dumping and harm to the industry or an extension of the anti-dumping duties."

If the Chinese ministry does not receive any applications to review the scheduled expiration of the anti-dumping duties, "the anti-dumping measures will be suspended from 8 Sept. 2014," the statement said.

As MRC wrote before, Zhuhai Zhongguan Petrochemical is in plans to start a butadiene plant in the first half of 2014. To be located in Guangdong, China, the plant will have production capacity of 70,000 mt/year.
MRC