BP Amoco plc is looking to unload its downstream plastics products businesses, including 19 plants worldwide with annual sales of $1 billion.
The sale is needed because the businesses "do not fit closely with [BP's] chemicals strategy," as evidenced by recent deals with Solvay SA and Bayer AG, BP officials said.
"We believe there are other companies that will find [the processing businesses] to be excellent additions to their portfolios and who will be able to develop them to their full potential," Byron Grote, chief executive of BP's chemicals unit, said in a news release.
Included in the sale are two businesses: fabrications and fabrics/fibers.
The fabrications unit is a leading European producer of specialty packaging for food, pharmaceutical and industrial markets, supplying films for medical applications and blow molded parts and assemblies for the appliance and automotive markets. It is also a leading European producer of agricultural films and netting.
The fabrics/fibers unit is the world's largest maker of polypropylene carpet backings and nonwoven PP fabrics for furniture and bedding.
Of the 19 plants to be sold, seven are in the United States and six are in Germany. The remaining six are in England, Mexico, Brazil, Australia, Poland and Hungary. London-based BP also is selling its interest in joint venture sites in the United States, England, China and France.
The plastic fabrication sites to be sold include blow molding plants in Charlotte, N.C, and Rottenacker, Germany; and film plants in Darton, England, and four sites in Germany—Dietenheim, Wasserburg, Michelstadt and Nordhorn.
BP declined to reveal how the $1 billion annual sales total was split between fabrication and fabrics/fibers.
In May, BP's Deutsche BP AG unit, which serves as the operating company for BP's German businesses, acquired Bayer AG's 50 percent share in Erdolchemie, a petrochemicals joint venture between the two firms. EC Erdolchemie GmbH produces 1.2 billion pounds of polyethylene, 2 billion pounds of ethylene and 1.2 billion pounds of propylene annually in Worringen, Germany. The unit posted sales of almost $1.4 billion in 1999.
BP followed that move in December with a complex deal in which it swapped its engineering resins unit with Solvay's PP assets. The firms also agreed to merge their high density PE businesses into separate joint ventures in the United States and Europe.
"Combined, [the Bayer and Solvay] moves are a major step toward focusing the portfolio into a narrower set of leading global positions linked closely to BP's hydrocarbon streams," BP's Grote said.