Braskem buys Solvay vinyls unit in South America
Braskem, the largest polymer producer in the Americas, announced an agreement with Grupo Solvay to acquire 70.59% of the total and voting capital of Solvay Indupa, officials said on Wednesday.
Braskem says the acquisition confirms its commitment to develop the petrochemical and plastics industries in Brazil and South America by strengthening the vinyls chain and by its decision to continue investing to support the growth of its clients.
It also establishes an industrial base in Argentina, a market in which Braskem already has maintained a commercial presence for over 20 years.
The transaction price is $290 million. The consummation of the sales agreement will depend on prior analysis and approval by Brazil's antitrust agency CADE (Conselho Administrativo de Defesa Econômica).
Following the transaction's conclusion, Braskem will launch a public tender offer to non-controlling shareholders for the purchase of shares in Solvay Indupa on the Buenos Aires Stock Exchange.
Solvay Indupa produces PVC and caustic soda and owns two integrated industrial facilities in Brazil and Argentina that enjoy privileged geographic positions close to South America's two major consumer markets.
Created in 1948, Solvay Indupa has annual production capacity of 540,000 tpy of PVC and 350,000 tpy of caustic soda. Once the acquisition is finalized, Braskem will increase its annual production capacity to 1.25 million tons of PVC and 890,000 tons of caustic soda.
"Vinyls is a strategic market for our company. Braskem recently invested around R$1 billion in a PVC plant in the state of Alagoas, which was inaugurated in 2012, in order to meet the strong growth in demand for this resin associated with the growth in Brazil's infrastructure sector," said Carlos Fadigas, CEO of Braskem.
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