ExxonMobil to sell oriented polypropylene films business

(ft) -- ExxonMobil has retained a financial adviser to sell its OPP films business, a source familiar with the situation and an industry source told mergermarket.

The oil giant has mandated JPMorgan for the divestiture, the source familiar said, adding that a teaser on the unit had already been sent to prospective bidders.
A spokesperson for the Irvine, Texas-based oil company did not comment. JPMorgan did not respond to requests for comment.

The OPP (oriented polypropylene) films unit is part of the company's chemicals segment and has 118kmt (thousands of metric tons) capacity in the US. It also has 144kmt capacity in Belgium, Italy and the Netherlands, the source familiar said. The teaser did not include revenue or EBITDA.

The source familiar said Exxon inherited the films business from Mobil, categorizing the unit as non-core. The two oil giants merged in 1999 in a deal valued at USD 82bn.

In 4Q11, Exxon Mobil had chemical earnings of USD 543m, USD 524m lower than the fourth quarter of 2010. Weaker margins decreased earnings by USD 230m, while lower volumes and mix effects reduced earnings by USD 40m. Other items, mainly unfavorable tax effects, cut earnings by USD 250m, the company reported.

MRC

(thomasnet) -- BERICAP North America announced today that its exclusive DoubleSeal(TM) cap technology is now commercially available in the North American market. The design is considered unique for hot fill applications since it will support, rather than distort, the finish when compared to traditional two-piece closures that cannot hold the finish when softened by hot filled product.

DoubleSeal provides advanced tamper evidence and anti-sabotage protection, whereby the band breaks before the seal is broken. Better seal integrity, easier opening capability and improved economics complete a dynamic new offering.

"Traditional two-piece liner-and-shell top seal closures require considerable torque in order to properly seal the container," explains Dave Andison, President and Chief Operating Officer of BERICAP North America.

"In hot fill applications, the bottle neck is softened by the heat from the product itself. Consequently, the side and down-pressure from applying the closure puts considerable stress on the bottle finish. This can cause it to distort or ovalize, which can lead to leaking and product contamination."

MRC

(plastemart) -- Domestic PP and PE prices moved higher in China this week as producers in China lifted their prices in an effort to restore their lost margins.

Demand remains disappointing inside China as economic growth continues to moderate in the world's second largest economy, but producers commented that they are insisting on their new price levels as they cannot maintain satisfactory margins at their previous prices. China's import PP and PE markets were quiet this week as overseas producers wait in the sidelines while deciding on their April pricing policies. Traders generally left their offers steady on the week, commenting that the market is balanced between high upstream costs and lackluster demand.

"We have had no choice but to raise our PP prices as our margins had fallen into negative territory following the recent significant increases in upstream costs," a source at a domestic producer told.

A converter in the home appliance sector concurred, "Prices firmed up a bit this week. We are planning to purchase a small amount of material to keep our production going but will search the market for attractive prices before making any purchases. We plan to offer strong resistance to any further price hike attempts." "Our sales are disappointing these days but we will not agree to any discounts on our prices as we need to achieve the full extent of our price increases in order to repair our margins," reported a source at a domestic PE producer.

A distributor followed saying, "We are feeling more confident about the market outlook given producers' firm stance on prices. We are limiting our sales volumes for now as we feel that we will have to replenish at higher costs once we sell out our remaining stocks." A converter confirmed the demand situation noting, "We are not interested in making any purchases for now as we feel that we will not be able to pass our rising raw material costs onto our end product prices. We are skeptical as to the medium-term feasibility of the recent price hikes."

MRC

(plasticker) -- Specialty chemicals company Lanxess AG is to increase its prices in Europe, the Middle East and Africa for Durethan base resin, film and extrusion grades by Euro 0.13 per kilogram effective March 15, 2012. This price adjustment is due to significantly higher raw material and energy costs.

The relevant grades of the high-performance plastic Durethan are mainly used for the production of food packaging, industrial films, monofilaments and semi-finished products as well as a raw material for compounds.

The Semi-Crystalline Products business unit belongs to the Performance Polymers segment, which achieved sales of EUR 3.8 billion in 2010.

MRC

MOSCOW (MRC) -- In February, Russian producers of polypropylene left capacity utilization at rollover from the January. The total volume of polypropylene production made slightly more than 48,000 tonnes, according to MRC SkanPlast.

Last month, Russian producers of polypropylene left the capacity utilization at rollover from the January. The total production of polypropylene made 48,140 tonnes. In January, this figure was 48,650 tonnes. In February, Russian producers reduced the production of raffia and switched to the injection moulding grades of homopolymer of propylene. Volumes of production of propylene copolymers also decreased.

This year, three Russian producers increased the level of capacity utilization. The volume of polypropylene production at Ufaorgsyntez grew by 29% due to the use of external supplies of feedstock. Tomskneftekhim and Petrochemicals did not increase production so significantly: by 9% and 2%, respectively.

Over the weekend, the third largest Russian producer of polypropylene Stavrolen began working on a shortened schedule. Earlier this week, there were produced first lots of the injection moulding polypropylene, but the company still does not force the events. The shipments of polypropylene in the domestic market are not underway yet .

Because of the accident on December 15, 2011 at the gas distribution unit, company had to switch to imported propylene, which affects the level of capacity utilization.
At the end of the second quarter a new production at the Polyom site in Omsk is expected to be launched with a capacity of 120,000 tonnes per year on technology of LyondellBasell.

MRC