EQUATE Petrochemical net profit falls 28.9% in 2015

МОSCOW (MRC) -- EQUATE Petrochemical Company, Kuwait’s first international joint-venture in this industry, announced realizing a net profit of USD 739 million for the fiscal year ending 31 December 2015, in comparison to USD 1.04 billion achieved in 2014, said the company on its site.

EQUATE President & CEO Mohammad Husain said, "EQUATE’s human capital exemplified being ‘Partners in Success’ throughout all challenges in 2015. Their sustainability-based innovative approach and strategic outlook served the benefits of all stakeholders."

Husain noted, "We achieved excellent results in industrial operations, production, maintenance, as well as overall reliability in our human capital, processes and equipment. In addition, EQUATE achieved the objective of going global by acquiring MEGlobal, an international petrochemical company with global presence and growth opportunities."

Husain explained, "Other highlights include EQUATE achieving a total sales revenue exceeding USD 2.3 billion, and strengthening its presence in several markets by enforcing its customer-base, both locally and globally. EQUATE has contributed to the growth of the local plastics industry by over 400% from 1998 to 2015, and has supported Kuwaiti plastic converters to launch export operations of their products to several countries around the world. Additionally, our 2014 Sustainability Report has set precedence in Kuwait by completing Global Reporting Initiative’s Materiality Disclosures Service regarding the feedback of EQUATE’s stakeholders on its sustainability efforts and other applicable items."

Husain added, "During 2015, the global economy witnessed a number of serious challenges due to the drop of energy prices. Such a decrease impacted several business sectors, including the petrochemical industry. Petrochemical markets throughout the world, including Kuwait, went through serious fluctuations due to oil prices falling below USD 30 for an average of less than USD 50 throughout 2015. Our per-ton budget forecast for our products was an average of nearly USD 960, yet the actual global market price averaged at about USD 870."

As MRC reported earlier, EQUATE Petrochemical Co is in talks with banks to refinance a $6 billion bridge loan that it secured last year and was partly used to fund the acquisition of petrochemical company MEGlobal.

Commencing production in 1997, EQUATE is currently the owner and single-operator of several fully integrated world-class petrochemical units, within the Greater EQUATE joint-venture, that annually produce over 5 million tons of the highest quality grades of Ethylene, Polyethylene (PE), Ethylene Glycol (EG), Polypropylene (PP), Styrene Monomer (SM), Paraxylene (PX), Heavy Aromatics (HA) and Benzene (BZ). The products are marketed throughout the Middle East, Asia, Africa and Europe. Greater EQUATE includes EQUATE, The Kuwait Styrene Company (TKSC), Kuwait Paraxylene Production Company (KPPC) and The Kuwait Olefins Company (TKOC) under one fully integrated operational umbrella at Kuwait’s Shuaiba Industrial Area.
MRC

LANXESS names new head of Saltigo subsidiary

MOSCOW (MRC) -- From April 1, 2016, Torsten Derr (46), currently head of the LANXESS Board of Management’s Commercial & Supply Chain Excellence Initiative, will take over as head of Saltigo, a subsidiary of the specialty chemicals company, said LANXESS on its site.

The outgoing head, Wolfgang Schmitz (62), is retiring after 41 years in the company. "On behalf of the Board of Management, I would like to thank Wolfgang Schmitz for his outstanding leadership and loyal cooperation over the many years of his career at Bayer and LANXESS and wish him all the best for this new chapter in his life," said member of the LANXESS Board of Management Hubert Fink. "I would like to thank Torsten Derr for his pathbreaking work in the Commercial & Supply Chain Excellence Initiative and wish him every success in his new area of responsibility."

Torsten Derr was born in Bremen in 1970 and completed a doctorate in chemistry at the University of Bremen in 1997. He started his professional life at Bayer AG. In 2007, he took charge of the Caprolactam business line of the High Performance Materials business unit at LANXESS. On March 1, 2009, Derr was appointed head of the Material Protection Products business unit, before assuming responsibility for the Keltan Elastomers business unit from June 2013. In August 2014, the LANXESS Board of Management put him in charge of the Commercial & Supply Chain Excellence Initiative.

Since April 2006, LANXESS’ fine chemicals business has been run by a separate legal entity, Saltigo GmbH, which is wholly owned by LANXESS. The business unit is a leading supplier in the field of exclusive custom synthesis. The compounds that Saltigo manufactures form the basis for a variety of agricultural and pharmaceutical active ingredients, polymers and specialty chemicals that also play an important role in daily life.

Saltigo is part of the Advanced Intermediates segment, which achieved total sales in fiscal 2014 of EUR 1.6 billion. The company, which is headquartered in Leverkusen and has production facilities in Leverkusen and Dormagen, employs around 1,200 staff internationally.

As MRC informed earlier, following the approval of all relevant antitrust authorities, the new synthetic rubber joint venture of Lanxess and Saudi Aramco will start life on April 1 under the name Arlanxeo.

Saudi Aramco, officially the Saudi Arabian Oil Company, is a Saudi Arabian national oil and natural gas company based in Dhahran, Saudi Arabia. Saudi Aramco's value has been estimated at up to USD10 trillion in the Financial Times, making it the world's most valuable company. Saudi Aramco has both the largest proven crude oil reserves, at more than 260 billion barrels, and largest daily oil production.
MRC

Kraton closes acquisition of Arizona Chemical

MOSCOW (MRC) -- Kraton Polymers LLC announced that it has completed the previously announced purchase of all of the outstanding shares of capital stock of Arizona Chemical Holdings Corporation, which is one of the largest global providers of pine-based specialty chemicals, as per GV.

"We are pleased to announce that we have completed the acquisition of Arizona Chemical Holdings Corporation. Through the combination of Kraton and Arizona Chemical, we create a global leader in specialty materials technology, manufacturing, and geographical presence, providing value-added products and innovations serving a diversified range of end markets through a broad portfolio of highly-engineered polymers and specialty chemicals. The scale, complementary market positions, attractive margin profile and expected strong free cash flow generation capability of the combined company will serve as a strong foundation for future growth," said Kevin M. Fogarty, Kraton's President and CEO. "We now turn our focus to the implementation of our integration plan and the anticipated realization of USD 65 million of identified transaction synergies. To help ensure a seamless transition, both Kees Verhaar, Arizona's former President and Chief Executive Officer, and Frederic Jung, Arizona's former Vice President and Chief Financial Officer have agreed to serve in an advisory capacity to Kraton after closing."

The USD 1,370 million cash purchase price for the acquisition, which is subject to adjustment for cash, indebtedness, working capital, and other items, as well as the previously announced cash tender offer and redemption of all of Kraton's outstanding 6.75 % Senior Notes due 2019.

As MRC reported earlier, expanding on its global footprint and expertise in thermoplastic elastomer (TPE) innovation and design, PolyOne Corporation has recently announced it has acquired certain technologies and assets from Kraton Performance Polymers, Inc. The two companies also entered into a supply agreement, whereby Kraton will provide PolyOne certain raw materials used in production for the acquired business. The end markets utilizing the acquired technologies span new and fast growing applications in adhesive and removable protective films, as well as existing applications served by PolyOne, such as packaging, medical devices and personal care products. The purchase price of USD72 million represents a multiple of 9x EBITDA.
MRC

Iran, Brazil begin talks on Iranian investment in Brazilian refineries

MOSCOW (MRC) -- Iran and Brazil are in talks about a possible Iranian investment in troubled refinery projects controlled by Brazilian state-led oil company Petroleo Brasileiro SA, a Brazilian government source told Reuters.

Iran, which is boosting oil output after the end of sanctions over its nuclear program, is interested in exporting oil to Brazil and processing that crude at refineries in Brazil's northeastern region, the source said.

The source added that talks are at an early stage.

Iran has shown interest in investing in the construction of the Premium I and Premium II refineries in Brazil's northeastern states of Maranhao and Ceara, the source said. The refineries are designed to produce low-sulfur fuels. While plans for those projects were developed by Petrobras, as the state-owned oil company is known, they have been dropped from its investment plan.

To help reduce its debt of abut USD130 billion, Petrobras plans to sell USD15.1 billion of assets by the end of this year and it has long said it has been seeking partners for its refinery assets.

As MRC informed earlier, Petroleo Brasileiro SA agreed to sign a naphtha supply contract with Braskem SA, Latin America's largest petrochemical producer, for five years. Under terms of the deal, which was announced in a securities filing, Braskem will pay the equivalent of 102.1% of the benchmark ARA price for naphtha, a petrochemical feedstock.

Petroleo Brasileiro SA is also known as Petrobras. Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

AkzoNobel in talks to acquire BASF industrial coatings business

MOSCOW (MRC) -- AkzoNobel, the leading global producer of paints and coatings, said it is in discussions with BASF to acquire BASF’s industrial coatings business, said Chemweek.

"The strategy of AkzoNobel of driving operational excellence and organic growth includes the possibility to pursue value generating, bolt-on acquisitions," the company said. No further information will be made available at this stage. AkzoNobel's industrial coatings business had sales of around EUR780 million (USD884 million), or 14% of the company's performance coatings sales of EUR5.59 billion in 2014.

BASF confirmed that it is in discussions with AkzoNobel on the potential sale, but also declined to give further information. BASF is relatively small in industrial coatings. Its main coatings sectors are automotive and consumer. Industrial coatings are lumped under others, which in 2014 had sales of about EUR240 million, or 8% of coatings sales of EUR2.98 billion. BASF says its main competitors in industrial coatings are AkzoNobel and PPG.

BASF’s industrial coatings are produced at Munster and Oldenburg, Germany. The company offers systems for coating industrial products such as Coiltec, a universal non-chromate coil coating primer and foil coatings, applied to paper and plastic substrates. For the final finish of manufactured products, BASF’s industrial coatings portfolio comprises e-coats, spray and dip coatings, which are used for industrial buildings, radiator components, household appliances and wind turbines.

AkzoNobel Surface Chemistry is a global leader in the manufacturing and supply of specialty surfactants, synthetic and bio-polymer additives and specialty polymers. AkzoNobel currently employs more than 7,400 people in China.

As MRC informed earlier, BASF has signed an exclusive distribution agreement with Nexeo Solutions (The Woodland, TX), a privately owned chemical distributor, for the distribution of certain specialty high-performance solvents in the United States and Canada.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries.
MRC