Source: Plastemart (02/02/2010)
Dow Chemical Co. aims to sell Styron Inc, its styrene business by the end of March after an eight-month process by getting private equity approaches. After holding second-round bids last month, Dow is opening Styron’s books for further due diligence to whittle down the number of remaining suitors. Styron, with sales of US$5 bln valued by Dow between US$1-2 bln.
As interest in acquisitions is rising in the chemical industry, BASF plans to go the same way as it seeks to end an almost 3 year quest to sell unwanted styrene assets. Selling styrene assets will speed up BASF’s move away from less-profitable commodity products at a time when rivals in the Middle East rivals expand capacity. BASF’s styrenics unit generates US$4.2 bln in sales and is expected to be sold for €1-1.5 bln. For BASF, finding a buyer would mean avoiding a prolonged exit via a partnership agreement, viewed as a consolation move. Talks are under way with a potential partner for a styrene joint venture, as a prelude to exiting the market. Antitrust rules could prevent European rivals Total SA and Ineos Nova LLC from bidding. Petroleum Investment Co. of Abu Dhabi last year acquired Nova Chemicals Corp. of Canada. Saudi Basic Industries Corp. aims to become the world leader in chemicals by 2020.
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