BASF, Alpek swap business units as they change JV agreement

By Stephen Downer
Correspondent

Published: July 10, 2014 3:44 pm ET
Updated: July 10, 2014 3:54 pm ET

Image By: BASF SE Mexico's Alpek SAB de CV will buy BASF SE's EPS production facility in Guaratinguetá, Brazil, as part of the companies' new agreement.

Related to this story

Topics Materials, Mergers & Acquisitions, Materials Suppliers, Latin America
Companies & Associations BASF SE

MONTERREY, MEXICO — Alpek SAB de CV, the petrochemicals arm of Mexican conglomerate Alfa Group, has signed an agreement with German giant BASF SE that changes the complexion of their 50-50 Polioles SA de CV joint venture in Mexico.

As part of the deal, expected to be completed by early 2015, Alpek will acquire Polioles’ expandable polystyrene (EPS) business totally, including its EPS production facility in Altamira, eastern Mexico.

For its part BASF will acquire Polioles’ polyurethane (PU) business activities, including, according to a July 10 joint news release, “selected assets in its Lerma (Mexico) facility as well as all marketing and selling rights for PU systems, isocyanates and polyols.”

Alpek and BASF said Alpek will also purchase BASF’s EPS business operations in North and South America, including:

• BASF’s EPS sales and distribution channels in both regions.

• BASF’s EPS production facilities in Guaratinguetá, Brazil, and General Lagos, Argentina.

• BASF’s EPS foam parts business in Chile (Aislapol, SA).

Excluded from the transaction is BASF’s Neopor (gray EPS) business. BASF will continue to sell Neopor to its customers in the United States, Canada and South America. In Mexico, Alpek will sell Neopor for BASF, “based on a distribution agreement.”

The combined capacity of all EPS production facilities to be acquired by Alpek is about 230,000 metric tons per year, according to the news release. This figure includes Polioles’ 165,000 metric tons-per-year production plant in Altamira.

The two partners stated that about 440 employees work in the businesses affected by the agreements — 380 in the EPS unit and 60 in PU. The majority of these employees will keep their position.

Terms were not disclosed. Polioles will continue operations as an Alpek-BASF joint venture, with a product portfolio comprised of industrial and specialty chemicals.

Founded in 1965, Polioles supplies the construction, electronics, paintings, cosmetics, automotive and furniture industries. BASF acquired a 40 percent stake in it when it bought Wyandotte Chemicals Corp. in 1969.

Alfa purchased 60 percent of Polioles in 1974 and sold 10 percent of the company to BASF in 1994.

“This transaction represents an attractive opportunity for Alpek to build upon its EPS operations in Mexico, expand its EPS footprint across the Americas and consolidate its plastics & chemicals product portfolio,” said José de Jesús Valdez, Alpek’s CEO, in the news release.

“BASF will focus its EPS business on strategic markets in Europe and Asia as well as on Neopor, which is produced in Germany and Korea,” said Raimar Jahn, the president of president of BASF’s performance materials division.

Alpek is the largest petrochemical company in Mexico and the second largest in Latin America. The company operates two business segments: polyester (purified terephthalic acid, PET and polyester fibers) and plastics & chemicals (polypropylene, EPS, caprolactam, polyurethanes and other specialty and industrial chemicals).


Comments

BASF, Alpek swap business units as they change JV agreement

By Stephen Downer
Correspondent

Published: July 10, 2014 3:44 pm ET
Updated: July 10, 2014 3:54 pm ET

Post Your Comments


Back to story


More stories

Image

Deal puts Convergence Packaging under Comar's umbrella

October 24, 2014 2:00 pm ET

Convergence Packaging Holdings LLC, itself a product of mergers, now is joining together with Comar LLC.    More

Image

Akro-Plastic buying German subsidiary from Metabolix

October 24, 2014 3:32 pm ET

Akro-Plastic GmbH, a Niederzissen, Germany-based plastic compounder, has purchased the assets of Metabolix Inc.'s subsidiary in Germany.    More

Image

BASF pre-tax earnings rise, but will miss financial targets for 2015

October 24, 2014 10:16 am ET

BASF SE has raised its expectations for pre-tax earnings in 2014 but warned that it would not hit its financial targets for next year.    More

Image

Sabic, Shell cancel expansion for SADAF joint venture in Saudi Arabia

October 24, 2014 9:19 am ET

Saudi Basic Industries Corp. and Royal Dutch Shell have cancelled plans to expand an existing petrochemical joint venture in Saudi Arabia following...    More

Image

Sadara CEO says Middle East now has 20 percent of global ethylene capacity

October 24, 2014 9:33 am ET

Sadara CEO Ziad Al-Labban claims that the Middle East's ethylene capacity is now 20 percent of global production.    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