Indorama Holdings Ltd. of Bangkok, Thailand, is set to buy Eastman Chemical Co.'s PET business in the United Kingdom and the Netherlands for a maximum price of 65 million euros ($95.3 million).
Directors at the company have approved the takeover, which will add a total of 750 million pounds a year of PET capacity to Indorama's portfolio.
The deal will extend Indorama's existing European business, currently based on a greenfield operation in Lithuania that opened last year. It also will support its ambition of becoming one of the world's top three PET suppliers.
Indorama took over plants in Thailand in 1998 and StarPet Inc. in the U.S. in 2003 and will have an annual capacity of 3 billion pounds on completion of a U.S. expansion and the Eastman deal.
Kingsport, Tenn.-based Eastman has been selling its PET businesses outside the United States, with the goal of focusing on world-scale units where it can leverage its IntegRex technology.
Indorama Holdings Chairman Aloke Lohia said: ``Indorama is confident that this phase of consolidation in the European PET industry is the way to bring back returns in this otherwise lackluster market.''
Indorama cited a number of advantages to the acquisition: growing PET demand in Europe, low investment cost in comparison to building a new plant and access to a larger customer base.