Brazil regulator blocks Braskem acquisition of PVC maker Solvay Indupa

MOSCOW (MRC) -- Brazil's anti-trust regulatory body, the Administrative Council for Economic Defense (CADE), has vetoed Braskem SA’s purchase of Solvay Indupa SAIC, said Plasticsnews.

CADE said the two companies are the chief competitors in South America’s PVC market. The decision suspends a USD200 million deal that was announced in December 2013, in which Braskem, the largest petrochemicals company in the Americas, would have acquired the controlling 70.59% capital stake of Brussels, Belgium-based Solvay SA’s South American subsidiary. The deal would have made Braskem the top PVC producer in the Americas and the lone producer in Brazil.

CADE said the solutions Braskem offered to help balance the market were "behavioral remedies" that were "too fragile and weak," according to board adviser Gilvandro Araujo. Those solutions were not revealed publicly, due to confidentiality clauses.

Buenos Aires-based Solvay Indupa has two plants producing PVC resin for pipe and fitting production in Santo Andre, Brazil, and Bahia Blanca, Argentina, with a combined annual production capacity of more than 1 billion pounds.
The companies can file a new proposal that includes the sale of assets, CADE President Vinicius Marques de Carvalho said. He said Braskem should only buy one plant from Solvay.

In a corporate statement on Wednesday, Sao Paulo-based Braskem said the CADE decision is harmful to the Brazilian plastics industry, and that the PVC market should be considered an international one by Brazil's anti-trust regulator. Braskem said it will evaluate its options following the decision.

Solvay Indupa’s plants in Brazil and Argentina have capacity to produce 540,000 tonnes/year of PVC and 350,000 tonnes/year of caustic soda.

Indupa, with a manufacturing capacity of more than 500,000mtpa 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 Brazilian main producer of polyethylene and polypropylene. In addition with ongoing plants located in both petrochemical complexes, in April 2008 Braskem opened a 300,000 metric ton polypropylene plant in the city of Paulinia (Sao Paulo).
MRC

MOSCOW (MRC) -- Following clearance by the competition authorities, Ineos has successfully completed the purchase of BASF’s 50% share in Styrolution, a joint venture between the companies, as per the company's press release.

The purchase price for the acquisition is EUR1.1 billion.

Styrolution will continue to operate as a stand-alone Business within Ineos Industries Holdings Limited.

"We are pleased to have completed this acquisition. It represents another important step in the growth of the Styrolution business as it competes effectively with large-scale producers from Asia and the Middle East. We are pleased to bring Styrolution fully into the Ineos family," said Jim Ratcliffe, Chairman, Ineos Capital.

Styrolution was founded in October 2011 as a 50-50 joint venture between BASF and Ineos, and is the leading, global styrenics supplier.

As MRC wrote before, in October 2014, Ineos Industries Holdings Ltd agreed to acquire the Combined Heat and Power Plant (CHP) from Fortum, that serves the Grangemouth site, for GBP54 million.

Ineos Group Limited is a privately owned multinational chemicals company consisting of 15 standalone business units, headquartered in Rolle, Switzerland and with its registered office in Lyndhurst, United Kingdom. It is the fourth largest chemicals company in the world measured by revenues (after BASF, Dow Chemical and LyondellBasell) and the largest privately owned company in the United Kingdom.
MRC

MOSCOW (MRC) -- Mossi Ghisolfi Group has sold a USD300 million stake in its M&G Chemicals SA unit — including its global PET resin business – to private equity firm TPG, said Plasticsnews.

Mossi Ghisolfi — an Italian chemicals and fibers conglomerate – will retain majority ownership of M&G Chemicals, which is based in Luxembourg and operates PET plants in the U.S., Mexico and Brazil. The TPG investment "will enable us to grow and solidify our position as a leader in the global PET market … and will allow us to take advantage of market opportunities as they arise," M&G Chemicals CEO Marco Ghisolfi said in a Nov. 13 news release.

TPG officials added that they believe that M&G Chemicals’ projects "are very unique in the polyester space, and we look forward to supporting the company in their execution." San Francisco-based TPG controls USD66 billion in investments. The firm has owned resin distribution giant Nexeo Solutions LLC since 2010.

As MRC wrote before, M&G Chemicals plans to build a massive complex making PET resin and PTA feedstock in Corpus Christi, Texas. The firm posted sales of almost USD2.2 billion in 2013.

M&G Group is a family owned chemical engineering and manufacturing group headquartered in Tortona, Italy. M&G Group operates in the PET resin industry through its wholly-owned holding company Mossi & Ghisolfi International S.A. (M&G International). M&G International is one of the largest producer of PET resin for packaging applications in the Americas, with a production capacity of approximately 1.6 million tons per annum.
MRC

MOSCOW (MRC) -- In line with The Dow Chemical Company’s prior announcement of its intention to rationalize its investments in certain joint ventures, Dow will reconfigure and reduce its equity base in the MEGlobal and Greater EQUATE joint ventures, including The Kuwait Olefins Company (TKOC) and The Kuwait Styrene Company (TKSC), through a divestment of a portion of the company’s interests in these ventures, reported Dow on its site.

Dow expects such transaction(s) to be completed by mid-2015. While Dow will retain a substantial stake in these long-term partnerships, this effort will open opportunities for new investment in these successful and growing enterprises. Dow remains committed to maximizing the overall value of both MEGlobal and the Greater EQUATE joint ventures to further enhance their already demonstrated strong value and performance.

"We have been reviewing every aspect of our joint venture portfolio through our best-owner mindset, with the primary objective of identifying opportunities to deliver further value to our shareholders," said Andrew N. Liveris, Dow’s chairman and chief executive officer. "As a result of that analysis, we plan to reduce our equity position in MEGlobal and Equate. This strategic action allows us to redeploy capital to more strategic purposes, while still maintaining our commitment to these industry-leading joint ventures, which will continue to be an integral component of our strategy to be low-cost and integrated in key products."

As MRC informed previously, last year, Dow recently received USD2.2 billion for damages in cash from its Kuwaiti partner - one of the largest ever from a corporate arbitration - after the state-owned firm pulled out at the last minute from a USD17.4 billion deal to create a joint venture called K-Dow Petrochemicals.

MEGlobal is a world leader in the manufacture and marketing of monoethylene glycol and diethylene glycol (EG), and is headquartered in Dubai, UAE. Established in July 2004, MEGlobal currently markets over 2.5 million metric tons of EG per year globally. EG is used as a raw material in the manufacture of polyester fibers (clothing and other textiles), polyethylene terephthalate (PET) resins, antifreeze formulations and other industrial products. MEGlobal is a joint venture between Dow and Petrochemical Industries Company (PIC) of Kuwait.

Established in 1995, EQUATE is the operator of an integrated world-scale manufacturing facility producing more than 5 million tons annually of high-quality petrochemical products, including polyethylene, ethylene, and EG, that are marketed throughout the Middle East, Asia, Africa and Europe. Formed in 2004, The Kuwait Olefins Company (TKOC) is an international joint venture among Dow, Petrochemical Industries Company (PIC), Boubyan Petrochemical Company (BPC) and Qurain Petrochemical Industries Company (QPIC). EQUATE is the single operator of Greater EQUATE, which includes TKOC, TKSC, and Kuwait Paraxylene Production Company (KPPC) under one fully integrated operational umbrella at Kuwait’s Shuaiba Industrial Area.

The Dow Chemical Company is an American multinational chemical corporation. As of 2007, it is the second-largest chemical manufacturer in the world by revenue (after BASF) and as of February 2009, the third-largest chemical company in the world by market capitalization (after BASF and DuPont). Dow is a large producer of plastics, including polystyrene, polyurethane, polyethylene, polypropylene, and synthetic rubber.
MRC

MOSCOW (MRC) -- Albemarle Corp. and Rockwood Holdings have announced that shareholders from both companies approved the proposals relating to Albemarle's acquisition of Rockwood at their respective special meetings, reported Hydrocarbonprocessing.

"We are pleased with the support from both Albemarle and Rockwood shareholders, which reaffirms the strategic merits of this combination and represents another important step in creating a premier specialty chemicals company," said Luke Kissam, Albemarle's president and CEO.

"We are fully focused on the integration planning process to combine our companies and enable us to better serve customers and end markets around the world and deliver long-term value to shareholders," he added.

At Rockwood's special meeting, Rockwood shareholders approved the adoption of the agreement and plan of merger, pursuant to which a wholly-owned subsidiary of Albemarle will merge with and into Rockwood with Rockwood becoming a wholly-owned subsidiary of Albemarle.

As MRC informed previously, Albemarle Corp. agreed in July 2014 to pay USD6.2 billion in cash and stock for Princeton, New Jersey-based Rockwood Holdings, the largest lithium producer. Rockwood is one of four companies that control about 90% of the market for lithium. Demand for the metal will expand as much as three times faster than the overall economy, Baton Rogue, Louisiana-based Albemarle said in an investor presentation. Other lithium producers are just as bullish. The world market may double in a decade with demand growing at 7% to 10% annually, Chile’s Soc. Quimica & Minera de Chile said in April.

On November 13, Albemarle received regulatory clearance for the transaction from the European Commission. The transaction, which is expected to close in the first quarter of 2015, remains subject to the satisfaction of the closing conditions set forth in the merger agreement, including regulatory approvals in China.
MRC