Idemitsu defends Showa Shell merger opposed by founding family

MOSCOW (MRC) -- Japan's Idemitsu Kosan Co. Ltd. has defended its planned merger with smaller rival oil refiner Showa Shell Sekiyu KK, in the face of opposition from the founding Idemitsu family, as per Reuters.

Idemitsu said in a statement that the company's board confirmed Monday that the merger agreement followed appropriate procedures and there was no plan for now to change the schedule of the merger, planned for next April.

Last week, the founding family made a fresh call on management to give up its merger plan.

The family, which owns 33.92% of Idemitsu Kosan and is led by 89-year-old patriarch Shosuke Idemitsu, has said the two companies are too different for any merger to work. Earlier this month, it upped the ante in its opposition by buying a small stake in Showa Shell to block the process.

"The board meeting confirmed we will continue to seek a resumption of discussions with large shareholders, from the perspective of securing mutual benefits for all stakeholders, and work toward an early resolution," Idemitsu said in a statement.

The refiner has said its planned takeover of Showa Shell, which would create Japan's second-biggest refiner by capacity, is necessary to cope with lower demand.

Idemitsu agreed in July 2015 to the private purchase of Royal Dutch Shell PLC's 33.2% stake in Showa Shell for USD1.7 B, more than a third higher than its current value. Idemitsu then agreed in November to work towards a full merger with Showa Shell, now slated for April 2017, as MRC informed before.

But the founding family bought a 0.1% stake in Showa Shell, sufficient to complicate any takeover as it raises the prospect that Idemitsu would, contrary to current plans, have to make an expensive tender offer for Showa Shell shares.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.

Idemitsu Kosan is a Japanese petroleum company. It owns and operates oil platforms, refineries and produces and sells petroleum, oils and petrochemical products. The company runs two petrochemical plants in Chiba and Tokuyama. The two naphtha crackers can produce up to 997,000 tonnes of ethylene per year.
MRC

MOSCOW (MRC) -- PolymaxTPE has added two new styrenic TPE grades for gasket and seals applications to its portfolio, reported GV.

The grades, P32-010 and P32-011, can replace TPV elastomers in a variety of applications that include gaskets, seals, valves, home appliance, and food packaging requiring high resilience for seal integrity.

PolymaxTPE says that the grades stand out for their low compression set at elevated temperatures. According to the company, measurements show that the compression set of the P32-011 TPE (60 Shore A) has 16% at RT, 26% at 70 C and 38% at 100 C for 22 h. P31-010 (40 Shore A) has 20% compression set at RT, 27% at 70 C and 48% at 100 C.

Further advantages of the new grades are their good tear strength, cold temperature flexibility, low odour, stability at high temperature, and weather resistance. The raw materials used to manufacture these two grades are compliant with food contact regulations. These materials can be used in stand-alone injection moulding and extrusion applications, or bonded with polypropylene substrates.

"The development of new TPEs with low compression set for the seal industry reflects the focus of PolymaxTPE on R+D and its strategy of working proactively with customers", noted Dr. Martin Lu, CTO of PolymaxTPE.

"Thanks to their improved tear strength and easy processability, our recent commercialization successes of 35 and 45 shore A hardness TPE, D6935 & D6945, with low compression set has been well received by our customers in replacing TPV in weatherseals. The new addition of P32-010 and P32-011 will continue to provide a low-cost alternative to TPV in gaskets, stoppers, flexible connectors, and sealing for food, beverage caps + closures requiring durable sealing performance," added Tom Castile, VP sales of PolymaxTPE.

PolymaxTPE has a full-service facility in Waukegan, near Chicago, IL, USA. Sister company, Nantong Polymax, is one of the leading TPE manufacturers in China. The company’s products are marketed under the PolymaxTPE and Maxelast brands.

We remind that, as MRC informed before, in December 2015, Teknor Apex expanded its "polymer-neutral" product by developing styrenic TPEs with alternative cost and performance profiles to those of TPVs in automotive exterior application. The Sarlink ME-2200 series exhibit higher flow than comparable TPVs, enabling molders of exterior components such as gaskets, seals, and trim to process complex, intricate designs while shortening cycles through reduced packing and cooling time. In applications where TPV compounds are over-engineered, these compounds can provide a cost savings while still meeting the performance requirements of the part. Like TPVs, the compounds are less dense than EPDM and PVC, yielding weight savings of up to 15 and 23 %, respectively.
MRC

MOSCOW (MRC) -- Starting January next year, the Selangor state will ban the use of polystyrene (PS) containers and extend the No Plastic Bag Day on Saturdays to seven days a week, as per GV.

Green Technology and Environment committee chairman Elizabeth Wong said all official events and buildings of the Selangor state government would stop using plastic bags and PS by next month (Sept. 2016) to get the ball rolling.

"The current 20sen charge to buy a plastic bag on Saturdays as part of the No Plastic Bag Day campaign will be extended to every day of the week while polystyrene containers will be banned.

"Up until now, many peddlers and traders have had a positive response to the campaign to reduce the use of plastic bags and polystyrene," she said.

As MRC informed before, in January 2015, New York city Mayor Bill announced that all plastic-foam containers and packaging would be banned from New York City as of July 1, 2015. Restaurants, stores and manufacturers will no longer be allowed to possess, sell or offer items made with expanded polystyrene (EPS). The ban on Styrofoam stems from a law passed in December 2013 that gave officials a year to determine whether EPS could be recycled in a safe, environmental effective and economically feasible matter. According to the mayor's office, the Department of Sanitation determined it cannot.
MRC

MOSCOW (MRC) -- State-led oil company Petrobras reported Q2 2016 profit fell by nearly a third from a year earlier, missing analysts' expectations as oil prices fell, it took charges for layoffs and the impairment of a refinery, reported Hydrocarbonprocessing.

Petrobras said net income fell 30% to USD118 million in the three months ended June 30.

Last year's profit was one of the most anemic quarterly results in the company's recent history. The second-quarter 2016 profit comes after a USD395 M loss in the first quarter of this year.

The average profit estimate of eight analysts surveyed by Reuters was USD570 M. Estimates, though, ranged from a USD1.75 B real profit to a USD395 M real loss, as analysts struggled again with a lack of clear Petrobras guidance.

While total debt has eased 2% since the end of 2015, at USD124 billion it is still the largest in the oil industry.

The USD380 M cost of a voluntary dismissal program and USD350 M impairment charges for the Comperj refinery, whose construction was halted last year after eating up USD13.5 billion of investment, kept costs high even as revenue fell.

As a result, operating profit fell 25% to USD2.27 B. If a scaled back Comperj opens as now planned in 2023, it will be more than a decade late and nearly triple its original USD5.2 B budget.

Earnings before interest, taxes, depreciation and amortization, or EBITDA, a measure of a company's ability to generate cash from operations, was little changed rising 2.8% to USD6.4B, in line with analysts estimates.

As MRC wrote previously, since January 2016, Petrobras has been seeking to sell its 5.8 billion Brazilian real (USD1.4 billion) stake in petrochemical producer Braskem SA. Petroleo Brasileiro SA (Petrobras) hired Brazilian bank Banco Bradesco SA as a financial adviser and started to pitch the sale to foreign investors. Petrobras owns a 36 percent stake in Braskem, Latin America's largest petrochemical producer. The sale would help Petrobras meet its target of selling USD15.1 billion worth of assets in 2015-16, a key part of its plan to cut debt as oil prices plunge to 12-year lows.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

MOSCOW (MRC) -- A technical issue at a carbon monoxide plant owned by Saudi International Petrochemical Co. (Sipchem) and operated by its affiliate, International Gases Co. (IGC), has led to reduced capacity at plants producing acetic acid and ethyl acetate, as per Reuters.

The plants use carbon monoxide as a feedstock for some of their products.

Technical teams are focused on resolving the issue and restoring full operating capacity at the carbon monoxide plant. Initial estimates indicate the issue may continue until the third week of August, 2016.

As MRC informed previously, on July 26, 2014, Sipchem commenced trial runs at a new ethylene vinyl acetate (EVA)/low density polyethylene (LDPE) swing plant in Saudi Arabia. Located in Jubail, the plant has a production capacity of 200,000 mt/year.

Established in 1999, Saudi International Petrochemical Company (Sipchem) manufactures and markets methanol, butanediol, tetrahydrofuran, acetic acid, acetic anhydride, vinyl acetate monomer. Besides, it launched several down-stream projects to manufacture ethylene vinyl acetate, low density polyethylene, ethyl acetate, butyl acetate, cross linkable polyethylene, and semi conductive compound in 2013.
MRC