Ineos considers sale of two HDPE plants

LYNDHURST, ENGLAND (Updated May 10, 4 p.m. ET) — Ineos Group is considering a sale of two high density polyethylene plants in France and Italy.

In a May 9 news release, officials with Ineos said that plants in Sarralbe, France, and Rosignano, Italy, might be placed on the selling block because they're not back-integrated into the feedstocks needed to make HDPE.

Officials added, however, that both sites are profitable and that they both “have the potential to grow further in response to increasing demand from the market for their differentiated products.”

Ineos is announcing the possible sale “at a very early stage in the evaluation process,” officials said in the release, in order to handle the topic with employees, works councils and “interested third parties.” They also added that the outcome of these discussions “is not considered to be a foregone conclusion, as Ineos will only divest these sites if it is in the interest of its business and the long-term future of these sites.”

The Saralbe plant, opened by Solvay Group in 1970, has annual production capacity of about 430 million pounds on three lines. All of its HDPE output consists of specialty HDPE grades sold into pressure pipes, long-life food packaging and other niches.

The Rosignano unit opened in 1959 and has annual production of 440 million pounds on four lines. Markets for its HDPE include pressure pipes and textiles.

Ineos acquired both plants in 2005 when it bought the Innovene business of British Petroleum plc. Ineos is based in Lyndhurst, England, and ranks as Europe's largest olefins maker and third largest producer of polyolefins.

In Europe, Ineos operates integrated plastics and chemicals sites in Cologne, Germany; Rafnes, Norway; Lavera, France; and Grangemouth, Scotland. The firm employs 3,700 and posted sales of almost $7.2 billion in 2011. Its assets were assembled from businesses built by or bought from numerous materials firms, including British Petroleum, Solvay, Amoco and Borealis.