Changes in technology and raw material economics are leading Sabic Innovative Plastics to end a 12-year-old engineering resins joint venture with BASF AG.
Pittsfield, Mass.-based Sabic IP - formerly GE Plastics - and BASF AG of Ludwigshafen, Germany, had shared production at a polybutylene terephthalate plant in Schwarzheide, Germany. The site opened in 1997 with 130 million pounds of capacity and later expanded to 220 million pounds.
But now, Sabic IP has decided to dissolve the 50-50 partnership Dec. 31 - although the site will provide PBT to Sabic IP's compounding site in Bergen-op-Zoom, Netherlands, for a multiyear period. BASF will pay Sabic IP an undisclosed sum for its share of the venture.
``We look at PBT in terms of higher-end filled products,'' Sabic IP President and Chief Executive Officer Brian Gladden said in a Nov. 14 telephone interview. ``The resin needs to be competitive, but [in the BASF venture] it's not.
``For a variety of reasons - technology, scale, location - we can source it from other suppliers for less than we can from our own [joint venture]. We have to remain competitive.''
PBT made via technologies other than that employed at the Schwarzheide site can use materials such as terephthalic acid in a process that reduces both carbon-dioxide emissions and energy use, officials said.
Gladden added that Sabic IP remains very interested in the PBT market. The firm can supply additional PBT, if needed, from its plant in Mount Vernon, Ind. Capacity for the material also eventually may be added in Saudi Arabia, Gladden said.
Sabic IP produces and sells PBT under the Valox trade name, while BASF's trade name for the product is Ultradur.