Chicago-based Innovene and Delta, a Saudi company, will be equal partners in the joint venture. Delta said that a second plant may follow, making the venture worth $4bn (€3.2bn).
The first plant, called a "cracker" unit, is expected to be operational in late 2008. Crackers convert natural gas into ethylene, the raw material for plasticwrappings and containers, among other products
Since the beginning of 2003, ethylene prices for packagers have increased nine per cent. Benzene prices have increased 190 per cent while rude oil costs are up 65 per cent and natural gas hasrisen 67 per cent.
Last month Innovene and Nova Chemicals signed binding agreements to merge their European styrenic polymers businesses into a joint venture. Styrene-based resins are used for a wide variety ofgoods including lightweight packaging.
Innovene was created as a wholly owned subsidiary of BP on 1 April 2005 and has about $15bn (€12.2bn) revenues annually and $9bn (€7.4bn) in total assets. Innovene's major manufacturing sites include Grangemouth in Scotland, Lavéra in France, Köln in Germany andLima and Chocolate Bayou and Green Lake in the US.
Secco, a joint venture between Innovene, Sinopec and SPC in Shanghai became fully operational in March 2005 as the largest petrochemical plant in China to date. Innovene manufactures petrochemicals, including olefins(ethylene and propylene) and their derivatives such as polyethylene, polypropylene, acrylonitrile, linear alpha olefins, polyalphaolefins and solvents.
The chemicals are used to make a wide variety of plastic goods, including food and drink containers and wrappings, pipe work, automotive parts and mouldings. Innovene also manufactures gasoline, diesel and other refinedpetroleum products in the Grangemouth and Lavéra refineries.
BP says it is preparing Innovene for a possible initial public offering in second half of 2005, subject to market conditions and regulatory approval.
Barry-Wehmiller acquires packaging machinery plant in UK US-based Barry-Wehmiller announced this week it has acquired the packaging machinery division of Central Bottling Internationalin Yorkshire, England.
The division provides packaging equipment and packaging line design and other support services to the food and beverage industries. Called Central Bottling International, it will operate as a stand-alone business from its currentplant, the company said. The purchase is Barry-Wehmiller's fifth acquisition this year, under a programme to expand the company's global reach, especially in Europe. The purchase price was notdisclosed.
"The combination of organic and acquisition growth is expected to grow annual revenues to more than $530m for the first time in the company's 120-year history, with over $120m of that in globalmarkets," the company said in a statement. St. Louis-based Barry-Wehmiller Cos. Inc., a privately held company, is a holding company of various manufacturing companies.
Central Bottling International serves the food and beverage sectors in the UK. Missouri-based Barry-Wehmiller provides packaging equipment for the food, beverage, household, personal care, pharmaceutical, medical and biotechsectors.
Packaging Dynamics lowers profits guidance due to weak sales Packaging Dynamics has lowered its 2005 profit guidance, blaming sales declines in its specialty laminations business for the setback. Chicago-based PackagingDynamics makes flexible packaging products for the food service, food processing, bakery, supermarket, deli and concession markets.
The company cut its full-year outlook for earnings from continuing operations to a range of $1.13 to $1.23 per share from a prior forecast of $1.20 to $1.30 per share.
"Although the revenue weakness we have encountered is expected to diminish in the second half of the year, the rate of improvement is slower than our previous expectations," said chairman and chief executive Frank Tannura in a statement. "However, we remain enthusiastic about the long-term revenue and earnings growth opportunities available in both of our business segments."
The company reported net income for the first quarter of 2005 of $2m, a 36.4 per cent increase over the first quarter of 2004. The company had net sales of $86.8m, a 26.6 per cent increase comparedto the first quarter of 2004.