Celanese Mexicana SA de CV (Celmex) and Mexican industrial group Alfa SA de CV have signed a letter of intent to form an alliance for regional output of nylon and polyester. The final deal has not yet been closed, but if achieved, it basically will see the concentration of nylon polymer, textile nylon and nylon raw material caprolactam with Alfa and PET resin and textile polyester in Celmex's hands, according to Celmex spokesman Alfredo Arvizu.
Partly based on the prospect of new capital from the alliance, Celmex has announced plans to invest $70 million in its PET resin and polyester short-fiber operations. Both lines will be modernized and enlarged.
Celmex would sell all machinery and equipment at its sole world-scale nylon polymer and textile nylon plant in Ocotl n, Mexico, and its 50 percent share in the Mexican caprolactam raw material producer Univex SA, in Salamanca, Mexico.
Celmex is the Mexican subsidiary of German chemicals giant Hoechst AG. Arvizu said that the Ocotl n nylon plant is not a strategic business for Hoechst because it lacks the technological support enjoyed by other Hoechst enterprises.
The deal would consolidate and increase Alfa's place in the regional nylon market and allow it to compete better with the flow of imports, according to Celmex. Alfa's subsidiary Alpek SA will take on the acquisitions.
The original proposal was for Alfa to pay $45 million in cash and $10 million with interest in five years.
Celmex said that agreement with Alfa awaits approval by two Mexican authorities, including the anti-trust body, the Federal Commission for Competition.
An Alfa spokesman confirmed that the Celmex deal is not closed yet and declined to comment until it is finalized.
