BASF SE and Ineos Industries Holdings Ltd. announced Nov. 30 they have signed a letter of intent to combine their styrenics businesses into BASF's Styrolution business unit.
Ownership of Styrolution, based in Frankfurt, will be split 50/50 between the companies and BASF will receive a cash consideration once the transaction is completed. No other financial details were given.
Styrolution's creation, announced in October, carved out the bulk of BASF's own styrenics operations, a move that had been under review since 2007.
At the time, the company had refused to comment on whether it was looking for partners.
The joint venture will deliver new opportunities for innovation and growth that will provide significant benefit to our customers, Jim Ratcliffe, chairman of Ineos Capital, said in a statement. The world-scale assets will secure a sustainable and competitive business that is capable of meeting the long-term needs of a rapidly changing market.
Under the terms of the deal, BASF and Ineos will combine business activities in styrene monomers, polystyrene, ABS, styrene-butadiene block copolymers and other styrene-based copolymers, as well as copolymer blends.
BASF plants in Germany, Belgium, South Korea, India and Mexico, and Ineos plants in Canada, the U.S., Germany, France and Sweden will all become part of the new company.
The former Ineos Nova joint venture will be included in Styrolution. Calgary, Alberta-based Nova Chemicals Corp. confirmed Nov. 12 it had sold its stake in the venture to Ineos for an undisclosed price.
BASF's Roberto Gualdoni will take the role of Styrolution CEO, and Christoph de la Camp, currently chief financial officer at Ineos Nova, will become CFO.
BASF employs about 1,460 in its styrenics business and is expected to generate sales of more than $3.95 billion (3 billion euros) in 2010. Ineos employs about 2,200 in its styrenics activities, which will generate an estimated $2.6 billion (2 billion euros) in 2010 sales.