The joint venture, to be called Styrolution, would see the partners combine their businesses in styrene monomers (SM), polystyrene (PS), acrylonitrile butadiene styrene (ABS), and styrene-butadiene block copolymers (SBC). It will also include other styrene-based copolymers – such as SAN, AMSAN, ASA, MABS - as well as copolymer blends.
The companies confirmed a letter of intent was signed yesterday, with the joint venture subject to approval by the antitrust bodies.
“We wanted to create a business that will raise competitiveness in a market that is seeing the increasing presence of large operators from the Middle East and Asia,” Ineos spokesman Richard Longden told FoodProductionDaily.com.
AS part of a broad product portfolio, the new company would offer SBC (Styrene-Butadien-Blockcopolymer) - a thermoplastic resin used mainly in food packaging.
Regulatory approval
BASF said Styrolution would be formed on 1 January, 2011 and operate as a separate entity from the rest of the German-based giant’s units. Ineos announced that it would acquire the other 50 per cent stake in its styrenics joint venture, Ineos Nova, from Nova Chemicals. These would be transferred to the new company upon completion of the proposed joint venture with BASF, said the UK-based firm.
Expandable polystyrene is not part of the deal and both partners said they would retain these segments separately.
The parties hope to receive approval for the transaction by the end of 2011, with products available as soon as possible after that, added Longden. The new company would have an overall capacity of 6.3 million tonnes.
Plant assets
BASF said it would contribute its SM, PS, ABS, SBC and styrene-based copolymers businesses - including production plants in Germany (Ludwigshafen, Schwarzheide), Belgium (Antwerp), Korea (Ulsan), India (Dahej) and Mexico (Altamira). The firm expects its business to generate sales of more than €3bn in 2010.
INEOS, with expected 2010 sales reaching €2bn, intends to contribute ABS production plants at sites in Germany (Cologne), Spain (Tarragona), India (Vadodara) and Thailand (Map Ta Phut) as well as to the joint venture. SM and PS facilities in Canada (Sarnia), the United States (Indian Orchard, Joliet, Decatur, Texas City, Bayport), Germany (Marl), France (Wingles) and Sweden (Trelleborg).
“The business will ensure economies of scale are maintained and cost reduced,” said Longden.