BASF, INEOS ink deal for global styrenics JV
BASF and INEOS have signed a joint venture (JV) contract to combine businesses in styrene monomers (SM), polystyrene (PS), acrylonitrile butadiene styrene (ABS), styrene-butadiene block copolymers (SBC) and other styrene-based copolymers (SAN, AMSAN, ASA, MABS) and copolymer blends into the Styrolution venture.
Businesses with expandable polystyrene are not part of the transaction, the companies noted, where BASF and INEOS will retain their respective businesses.
The company headquarters will be located in Frankfurt/Main, Germany. In the joint venture, 50% of the shares will be owned by BASF and 50% by INEOS.
BASF will receive cash consideration following the completion of the transaction, officials said. Specific figures were not disclosed.
“The joint venture agreement paves the way for a globally competitive business that will provide significant benefit to its customers,” said Jim Ratcliffe, chairman of INEOS Capital. “Styrolution will be capable of meeting the long-term needs of a rapidly changing market as it competes effectively with large-scale producers from Asia and the Middle East. ”
BASF plans to contribute its SM, PS, ABS, SBC and styrene-based copolymers businesses in the joint venture. This includes production plants located in Germany (Ludwigshafen, Schwarzheide), Belgium (Antwerp), Korea (Ulsan), India (Dahej) and Mexico (Altamira).
BASF employs approximately 1,460 people in its styrenics business and generated sales of about €3.9 billion in 2010, the company said.
Meanwhile, INEOS intends to contribute ABS production plants at sites in Germany (Cologne), Spain (Tarragona), India (Vadodara) and Thailand (Map Ta Phut) to the joint venture. In addition, INEOS will contribute its SM and PS businesses to the joint venture, which includes INEOS and INEOS Styrenics sites in Canada (Sarnia), the United States (Indian Orchard, Joliet, Decatur, Texas City, Bayport), Germany (Marl), France (Wingles) and Sweden (Trelleborg).
INEOS employs approximately 2,200 people in its styrenics activities and generated sales of about €2.8 billion in 2010.
BASF and INEOS will continue to operate as strictly independent companies until the completion of the deal, which is anticipated in 2011, subject to the approval by the appropriate antitrust authorities.
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