Styron exiting North American commodity polycarbonate market

By Frank Esposito
Senior Staff Reporter

Published: May 30, 2014 11:49 am ET
Updated: May 30, 2014 1:37 pm ET

Image By: Styron LLC

Related to this story

Topics Materials, Canada, Mexico, United States, Materials Suppliers

Styron LLC no longer will sell commodity grades of polycarbonate resin in North America.

Berwyn, Pa.-based Styron will end its PC supply agreement with Dow Chemical Co. in the fourth quarter of this year. Dow had produced PC for Styron on a contract basis at a plant in Freeport, Texas, since Styron was spun off from Dow and acquired by private equity firm Bain Capital in 2011.

Commodity PC grades — including those used in sheet, bulk extrusion and optical media — “tend to be lower-margin,” Styron spokeswoman Catherine Maxey said in a May 30 phone interview. So Styron will no longer serve those markets.

Styron will continue to market higher-margin compounds and blends that are toll-produced by PolyOne Corp. These materials are sold into medical devices, lighting, automotive and similar applications. PC used in those blends will be sourced from an unidentified third-party supplier and from a Styron PC plant in Stade, Germany, Maxey said.

“Our [compound and blends] customers won’t see any change, and no Styron jobs will be affected,” she added.

According to Maxey, Dow will discontinue PC production in Freeport, where Styron had been its sole customer. Dow will close and dismantle its PC unit there, she said. Officials with Dow in Midland, Mich., could not be reached for comment.

In a recent filing with the Securities and Exchange Commission, Styron officials said the firm would have saved $35 million in 2013 by ending its contract with Dow and altering some raw material contracts at its Stade plant.

Styron’s exit from the commodity PC market will leave Sabic Innovative Plastics and Bayer MaterialScience as North America’s only remaining regional producers of that material. BMS parent Bayer AG of Leverkusen, Germany, has been seeking a buyer for that unit, according to media reports.

Styron posted mixed results in the first quarter of 2014. Sales fell 2 percent to $1.36 billion, but the firm registered a $17.1 million profit after losing $9.7 million in the same quarter last year. In addition to engineered polymers, Styron’s products include styrenic resins, synthetic rubber and latex. The firm’s assets include a 50 percent stake in Americas Styrenics, a joint venture it operates with Chevron Phillips Chemical Co.

Styron also earlier this year filed for an initial public offering at an unspecified date. The firm hopes to raise as much as $200 million through the IPO. The firm had filed for an IPO in June 2011, but withdrew that filing in June 2013. After the IPO, Styron plans to operate as Trinseo SA.

Funds raised by the stock offering would be used to pay down debt, for working capital and for general corporate purposes, officials said in the filing. No stock exchange or target per-share price was listed in the filing.

Styron employs 2,100 worldwide and posted sales of just over $5.3 billion in 2013.


Comments

Styron exiting North American commodity polycarbonate market

By Frank Esposito
Senior Staff Reporter

Published: May 30, 2014 11:49 am ET
Updated: May 30, 2014 1:37 pm ET

Post Your Comments


Back to story


More stories

Image

Celanese buys conductive polymer supplier

October 21, 2014 4:31 pm ET

Materials firm Celanese Corp. has acquired most of the assets of conductive polymers maker Cool Polymers Inc. for an undisclosed price.    More

Image

Wisconsin cast film maker buys Ohio blown film specialist

October 21, 2014 2:57 pm ET

A Midwest U.S. acquisition has created a company armed with two distinct film technologies: cast films and coextruded blown film constructions.    More

Image

BASF targets coffee and automotive connoisseurs with new resin grades

October 21, 2014 2:07 pm ET

BASF SE is using polybutylene terephthalate (PBT), which is normally used to manufacture high-end electronics, in a food consumer packaging product.    More

Image

Omega buys Vinylex, adds capacity, locations

October 21, 2014 1:48 pm ET

Profile extruder Omega Plastics LLC has expanded its stake in the market by acquiring Vinylex Corp.    More

Materials firm realigns business divisions

October 20, 2014 1:23 pm ET

Trinseo S.A., formerly known as Styron L.L.C., is realigning its business divisions, creating two new business groups — Performance Materials an...    More

Market Reports

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 million dollar plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our analysts provide insight on business trends, foreign investment, top end markets and plastics processing activity. The report also provides important data on exports, production, employment and value of plastics products manufactured.

Learn more

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

More Events