Shanghai Chlor-Alkali Chemical Co. Ltd. is seeking a buyer for its 10 percent stake in Bayer Polymers (Shanghai) Co Ltd., a polycarbonate manufacturing unit of Bayer AG's wholly owned Bayer (China) Ltd. subsidiary.

Bayer Polymers (Shanghai) was established as a 90-10 joint venture in September 2001 with registered capital of US$188.1 million. The company has been producing polycarbonate, PC/ABS blends, etc. with an annual capacity of 100,000 metric tons since September 2006.

The local manufacturing facility, however, hasn't been profitable. It has taken sizable losses in the past few years: 365.3 million yuan (US$53.4 million) in the red in 2007 and 424.2 million yuan (US$62 million) in 2008. Shanghai Chlor-Alkali cites radical market fluctuation, China's export rebate policy change and rising production cost, among other reasons, for the joint venture's failing business.

Challenged by continuous losses, Bayer Polymers (Shanghai) will be restructured by majority owner Bayer (China), a move that can severely dilute Shanghai Chlor-Alkali's stake in the underperforming joint venture. Therefore, Shanghai Chlor-Alkali hopes to sell its share before changes occur.

Shanghai Chlor-Alkali is a 51.6-percent-owned subsidiary of state-owned Shanghai Huayi Group Corp. The company's board of directors approved the sale in late January, according to an announcement. The Shanghai United Assets and Equity Exchange Web site shows that Bayer Polymers (Shanghai) -- classified as a state-invested enterprise -- is listed from February 26 through March 26.