MOSCOW (MRC) -- Samsung Electronics Co. is in advanced talks to buy some or all of the operations of auto-parts maker Magneti Marelli from Fiat Chrysler Automobiles NV, according to Bloomberg.
Samsung is particularly interested in Magneti Marelli’s lighting, in-car entertainment and telematics business and could consider an acquisition of the whole company, the people said, asking not to be identified as the discussions are private. The deal could be worth more than USD3 billion with a goal of closing this year, said one of the people. That would make it Samsung’s biggest-ever acquisition outside South Korea. Fiat’s shares rose the most since October 2014.
A move into automobile components would help decrease Samsung’s reliance on consumer electronics. Vice Chairman Lee Jae Yong, 48, is reshaping South Korea’s biggest company as he takes on more responsibilities once held by his father. He has sold off assets and narrowed the conglomerate’s scope as he seeks to bounce back from a downturn in the smartphone business.
Lee, who has been a director of Fiat Chrysler’s controlling shareholder Exor SpA since 2012, would also position his company to benefit from the rising interest in cars from technology companies. Apple Inc., Baidu Inc. and Google are pushing into automobiles, seeking to deploy their technology into new areas as cars become more advanced. Samsung had more than USDS70 billion of cash and marketable securities as of March 31, according to data compiled by Bloomberg.
In addition to global leadership in smartphones, Samsung is the world’s biggest producer of memory chips and televisions. Samsung declined to comment in an e-mail statement. A Fiat Chrysler spokesman had no comment. Fiat Chrysler gained 8.3 percent to 5.90 euros at the close in Milan. The company’s U.S. shares climbed 8.9 percent in New York for their biggest increase since October 2014. Samsung Electronics U.S. shares fell 3 percent.
The European shares have lost 31 percent this year, compared with an 18 percent decline in the Stoxx Europe 600 Automotive & Parts Price Index. Exor climbed 3 percent to 33.91 euros. News of the talks also lifted shares of Sogefi SpA, another Italian parts maker that has attracted interest from private equity firms. Sogefi gained 4.7 percent to 1.55 euros.
The first major carmaker to strike a deal with Google on driverless vehicles, Fiat Chrysler is in discussions with other technology companies, Chief Executive Officer Sergio Marchionne said on a conference call after the company’s second-quarter earnings results last month.
After calling off efforts to pursue a merger with General Motors Co., Marchionne has made eliminating debt his highest priority before he leaves the post in 2019. Achieving the goal would put Fiat Chrysler in a better position to find a partner. Marchionne contends that the auto industry wastes too much money and needs to consolidate to finance investment in new technology.
Marchionne said in April that there will be a point in time when Fiat will consider a disposal of Magneti Marelli.
MRC
MOSCOW (MRC) -- Negotiations over prices of European polyvinyl chloride (PVC) for August shipments to the CIS markets began this week. All producers announced a roll-over of July export prices for August shipments, according to ICIS-MRC Price report.
The contract price of ethylene in Europe for August shipments was agreed by EUR20/tonne below the level of July, which reduced the PVC production costs by about EUR10/tonne. However, European producers announced a roll-over of July export PVC prices for this month. A producer does not intend to ship resin until the second half of the month because of the shutdown for maintenance.
This week's negotiations over August deliveries of suspension polyvinyl chloride (SPVC) to the CIS markets were held in the range of EUR770-835/tonne FCA, which actually equalled July prices.
Producers do not have significant restrictions on export quotas. Only BorsodChem, the Hungarian producer, might start its shipments in the second half of August because of a scheduled turnaround.
MRC
MOSCOW (MRC) -- The August contract price of propylene in Europe was agreed at the level of July. Nevertheless, this month's opinions of European producers on export polypropylene (PP) prices for the CIS countries differed, according to ICIS-MRC Price report.
Negotiations over August prices for European PP began on Monday. Many market participants said some European producers had slightly reduced their export prices for propylene homopolymer (homopolymer PP) supply in August, whereas prices of propylene copolymers rolled over from July. A producer, on the contrary, raised its prices.
This week, August deals for homopolymer PP have been negotiated in a fairly wide range of EUR910-1,040/tonne FCA, whereas last month's deals were done in the range of EUR880-1,060/tonne FCA. Some manufacturers still had restrictions on shipments of homopolymer PP, particularly, of raffia grade.
Deals for block copolymers of propylene (PP-block) were discussed in the range of EUR1,065-1,130/tonne FCA. Negotiations over August shipments of statistical propylene copolymer (PP-random) were held in the range of EUR1,095-1,160/tonne FCA.
MRC
MOSCOW (MRC) -- Formosa Plastics Corp (FPC), part of Formosa Petrochemical, is in plans to shut a caustic soda plant for a maintenance turnaround, Apic-online.
A Polymerupdate source in Taiwan informed that the plant is likely to be shut in mid-August 2016. It is expected to remain shut for around 3-4 weeks.
Located in Mailiao, Taiwan, the plant has a production capacity of 1.3 million dry metric tonne (DMT)/year.
As MRC informed previously, Formosa Plastics also plans to shut its polyvinyl chloride (PVC) plant in Taiwan for a maintenance turnaround. The plant is likely to be taken off-stream in August 2016 and is expected to remain shut for around 3 weeks. Located in Mailiao, Taiwan, the PVC plant has a production capacity of 500,000 mt/year.
Formosa Petrochemical is involved primarily in the business of refining crude oil, selling refined petroleum products and producing and selling olefins (including ethylene, propylene, butadiene and BTX) from its naphtha cracking operations. Formosa Petrochemical is also the largest olefins producer in Taiwan and its olefins products are mostly sold to companies within the Formosa Group. Among the company's chemical products are paraxylene (PX), phenyl ethylene, acetone and pure terephthalic acid (PTA). The company's plastic products include acrylonitrile butadiene styrene (ABS) resins, polystyrene (PS), polypropylene (PP) and panlite (PC).
MRC