WASHINGTON - The Federal Trade Commission on Dec. 21 approved Shell Oil Co.'s planned divestiture of its polypropylene business in a $260 million sale to Union Carbide Corp. Union Carbide of Danbury, Conn., will become the fifth-largest PP producer in North America. It will acquire Shell's Norco, La., PP facility and Shell's 50 percent share of Seadrift Polypropylene Co. in Houston. Carbide already owned 50 percent of that venture.
Combined, the facilities can produce 800 million pounds of random and impact copolymer PP a year. The business includes manufacturing and marketing of PP resins and catalysts, technology related to PP manufacturing, and related research and development facilities at Shell's West Hollow Technology Center in Houston, which Union Carbide will lease as part of the acquisition.
The facilities market resins primarily for injection molding applications, including packaging, automotive and appliances, in North America.
Union Carbide primarily is a producer of polyethylene and a developer and licenser of polyolefin technology.
Shell of Houston agreed in 1995 to divest its U.S. PP business units in an agreement with the FTC related to the commission's antitrust concerns over the merger of the Royal Dutch/Shell Group's worldwide PP business with Montedison SpA of Milan, Italy. That merger formed Montell Polyolefins, based in Hoofddorp, Netherlands. Shell Oil is a unit of Royal Dutch/Shell Group of London and The Hague, Netherlands.
The FTC said Shell will sell propylene monomer to Union Carbide ``for three years, using prices, terms and conditions no less favorable than those on which Shell Oil sells [propylene monomer] to Montell Polyolefins.''