Mitsubishi Chemical group to combine 3 units

MOSCOW (MRC) -- Mitsubishi Chemical Holdings plans to merge its three wholly owned chemical subsidiaries in April 2017 to allow for more efficient distribution of management resources, said Asia.nikkei.

An official decision to combine Mitsubishi Chemical, Mitsubishi Plastics and Mitsubishi Rayon is expected at a board of directors meeting to be held that day. The three subsidiaries together generated roughly 3 trillion yen (USD24.15 billion) in sales in the year ended March 31.

Plans call for Mitsubishi Rayon to absorb its two sister companies. Details such as the merged entity's name and president will be decided later.

Mitsubishi Chemical Holdings had said July 16 that it would consider integrating its three chemical units and make a final decision by the end of the fiscal year.

Under a five-year business plan through fiscal 2020, Mitsubishi Chemical Holdings aims to boost return on equity to the 10% level, up from the 6% level for fiscal 2014. Though the company is the industry leader in sales in Japan, it is no match for U.S. and European chemical giants in terms of scale or profitability. By consolidating operations and streamlining back-office segments, the company looks to distribute resources more efficiently. The reorganization will make it easier for the company to assign personnel in growth fields such as automobiles and health care.

Overseas markets account for roughly 45% of Mitsubishi Chemical Holdings' sales. The company hopes to raise this figure by strengthening its development and marketing.

As MRC informed earlier, Mitsubishi Polyester Film, Inc. announced an investment of USD100 million to increase its capacity for biaxially oriented polyester (BOPET) film at its plant in Greer, SC. The investment will include a new film production line scheduled to start up mid-year 2017.

Mitsubishi Chemical with headquarters in Tokyo, Japan, is a diversified chemical company involved in petrochemicals, polymers, agrochemicals, speciality chemicals and pharmaceuticals. The company's main focus is on three business pillars: petrochemicals, performance and functional products, and health care.
MRC

ChinaCoal Mengda’s PP & PE project delayed by environmental concerns

MOSCOW (MRC) -- The start of production at ChinaCoal Mengda New Energy & Chemical Industry Co.’s polypropylene (PP) and polyethylene (PE) plant in Ordos, Inner Mongolia, has been delayed until the first quarter of next year because of environmental concerns, the China Chemical Fiber (CCF) Group reported, as per GV.

Initially scheduled to begin production in 2014, the 10.5-billion yuan methanol-based project is designed to produce 300,000 t/y of PP and 300,000 t/y of PE.

CCF noted that the delay of the project will give a break to the "already-in-surplus" PP market in China.

We remind that, as MRC informed before, Jiutai Energy started commercial production at its new coal-to-polyethylene in September 2015. The plant began to operate at normal rates from December 2015. Located at Erdos, Inner Mongolia region in China, the new PE plant has a production capacity of 300,000 mt/year.
MRC

INEOS expands feedstock procurement and trading activity in Europe

MOSCOW (MRC) -- INEOS has announced the expansion of its cracker feedstock procurement and trading activity within Europe. The new trading business will be headquartered in Rolle, Switzerland and, from next month, will also have operations based out of INEOS' office in London, said the producer on its site.

Having previously outsourced the majority of the procurement of its European naphtha requirements, INEOS is now bringing this "in-house" to leverage its large and established position within these commodity markets. This activity will be conducted through the Trading & Shipping business which is part of INEOS Europe AG.

David Thompson, CEO of INEOS Trading & Shipping said “We are delighted to be enhancing our presence within the feedstock trading sectors which will contribute significantly to the sustained delivery of commercial value across our large portfolio of assets."

As an integral part of this project , INEOS is pleased to announce the conclusion of an agreement with Oiltanking Ghent for the storage and throughput of naphtha.

Although this business will encompass all of INEOS’ naphtha activity including the output of the refineries at Grangemouth and Lavera, the main beneficiary of the agreement with Oiltanking Ghent is the INEOS site in Koln. Naphtha is the main feedstock used at the site which supplies two ethylene production units (crackers) of 1.3 million tons per annum total capacity and is delivered to the site by pipeline or barges on the River Rhine.

INEOS is a significant consumer of ethane, propane, butane, naphtha and condensates. The integrated trading business enables not only provision of these feedstocks where they are needed but also financial risk management in a constantly changing market.

As MRC informed earlier, Ineos have been making space on their massive Grangemouth site to build a new GBP20 million headquarters. The explosive demolition work at the plant last week helped clear the way for the state-of-the-art four storey facility – just one element of the company’s multi-million pound regeneration of the 1700 acre site - which is scheduled to be operational by September 2016.

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

Sabic eyes up acquisitions in 2016

MOSCOW (MRC) -- One of the world’s largest petrochemical manufacturers, Saudi Basic Industries Corporation, or Sabic, will make "at least one acquisition" next year, according to its chief executive, reported GV.

Yousef Al Benyan, acting vice chairman and chief executive of the Riyadh-based company, said on that Sabic was planning to announce the potential additions to its core market early in 2016. "I can tell you that [we are evaluating] between two to four companies in North America and China,” he said, declining to expand on the types of companies being looked at.

"All options are open as long as those potential targets fit with the strategy either in our core products - specifically technology – we are willing to go after it," said Al Benyan. Sabic’s goal is to take advantage of the current market volatility, triggered by the drop in oil prices, which has threatened the industry as margins tighten.

Al Benyan said that the Gulf Cooperation Council (GCC) petrochemical industry had to improve its competitiveness with the rising threat of US producers and increasing self-sufficiency of China.

As MRC wrote before, in November 2014, KBR was awarded a front-end engineering design (FEED) contract by Saudi Basic Industries Corp. (SABIC) for the debottlenecking and expansion of its Petrokemya butadiene extraction plant in Al Jubail, Saudi Arabia.

Besides, Sabic is modifying its Wilton cracker in the UK to enable it to use ethane feedstock imported from the US. The company is aiming to complete the project by 2016.

Saudi Basic Industries Corporation (Sabic) ranks among the worldпїЅs top petrochemical companies. The company is among the worldпїЅs market leaders in the production of polyethylene, polypropylene and other advanced thermoplastics, glycols, methanol and fertilizers.
MRC

Solvay successfully completes acquisition of Cytec

MOSCOW (MRC) -- Solvay has successfully completed the acquisition of Cytec and will immediately begin the integration of Cytec’s businesses to deliver cost synergies and capture significant business opportunities in advanced lightweighting materials for the aerospace and automotive industries and in specialty chemicals for mining, asp er Cytec's press release.

A large team of Solvay and Cytec personnel has been mobilized since early October to prepare detailed integration plans. Solvay will also create two new Global Business Units (GBU):

a GBU will group Cytec’s composite businesses Aerospace Materials and Industrial Materials. Bill Wood is appointed President of this GBU, which will form part of the Advanced Materials segment;

a GBU will combine Cytec’s In Process Separation, Polymer Additives and Formulated Resins activities with Solvay’s phosphorus-based intermediates. Mike Radossich is appointed President of this GBU, which will form part of the Advanced Formulations segment.

Solvay fully expects to generate a minimum of EUR100 million in annual synergies within three years after the acquisition. The acquisition is expected to be accretive to adjusted earnings and free cash flow after the first year of the acquisition and to CFROI in the mid-term.

The financing of the acquisition is nearly completed. It consists of the issuance of around EUR4.7 billion senior and hybrid bonds and the ongoing EUR1.5 billion right issue.

As MRC informed earlier, on July 28, 2015, Solvay entered into a definitive agreement with U.S.-based Cytec to acquire 100% of its share capital for USD75.25 per share in cash. The acquisition has been approved by Cytec’s shareholders, but is still subject to customary closing conditions, including regulatory approvals. Cytec will be fully consolidated within the Solvay Group as from Jan 1st, 2016.

Cytec Industries Incorporated, based in Woodland Park, New Jersey is a speciality chemicals and materials technology company with pro-forma sales in 2004, including the Surface Specialties acquisition, of approximately USD3.0 billion. Cytec is a result of its spin-off from American Cyanamid Company. It makes resins, plastics, and composite materials, especially for the aerospace industry and other users of specialty materials.

Solvay S.A. is a Belgian chemical company founded in 1863, with its head office in Neder-Over-Heembeek, Brussels, Belgium. The company has diversified into two major sectors of activity: chemicals and plastics. Solvay supplies over 1500 products across 35 brands of high-performance polymers - fluoropolymers, fluoroelastomers, fluorinated fluids, semi-aromatic polyamides, sulfone polymers, aromatic ultra polymers, high-barrier polymers and cross-linked high-performance compounds.

MRC