Akzo Nobel commissions new powder coatings facility near Mumbai

MOSCOW (MRC) -- India’s fourth largest paint company, Akzo Nobel India Limited commissioned its new powder coatings facility at Thane (near Mumbai, Maharashtra), as per Indiainfoline.

The company invested Rs65cr in the facility and the same was inaugurated by CEO Thierry Vanlancker. Akzo announced this to the stock exchanges on February 15, 2018.

The powder coatings facility in Thane is intended to boost Akzo’s access to markets in North and West India. It will complement the existing plant in Bengaluru (Karnataka) and will have additional lines in bond metallic powder and pipe and re-bar coatings.

A majority of the company’s revenues comes from industrial coatings while the remainder is from decorative paints. Within decorative coatings, it has the famous “Dulux” brand. Within industrial coatings, it has marine coatings, powder coatings, metal coatings, vehicle refinish and specialty coatings in its product portfolio. The recent quarterly results (Q3FY18) clearly reflected pressure on operating margins of ANIL due to input cost inflation and volatile exchange rate. Future safeguarding of operating margins will require the company to take price hikes. Given the improving demand environment, we feel that this should not be very difficult. Economic revival and focus on housing segment will bring volume growth back to double digit levels in Q4FY18.

Akzo Nobel India Ltd is currently trading at Rs1,805, up by Rs1.75 or 0.1% from its previous closing of Rs1,803.25 on the BSE.

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Deloitte Global 2018 chemical industry mergers and acquisitions outlook

MOSCOW (MRC) -- Global chemical mergers and acquisitions (M&A) activity in 2018 is expected to remain strong, as higher valuations continue to be mitigated by improving global economic conditions, continued inexpensive financing, and an appetite amongst industry participants for growth and transformative M&A transactions, according to Deloitte Global's 2018 chemical industry mergers and acquisitions outlook, as per Hydrocarbonprocessing.

A multitude of mega-deals which resulted in record levels of deal value in 2015 and 2016 were not seen in 2017 (46.4 USD billions). Deal volumes on the other hand were just as strong in 2017 with 637 transactions. "There may be a slight decline in deal volume in 2018 as the dispositions from the mega-deals have subsided, but 2018 is expected to be another robust M&A year in the chemical industry," said Dan Schweller, Deloitte Global M&A leader for the Chemicals & Specialty Materials Sector. "Deal flow remains strong and there remains great interest in turning to M&A to further drive shareholder returns."

In the US, historic tax reform measures that have cut tax rates and increased cash repatriation from international locations may serve to support M&A activity. "US corporate taxpayers will likely benefit from having more cash available to invest in improving their shareholders' value—this could result in additional capital expenditures, increasing buybacks or dividends, or in pursuing M&A activity," said Dan Schweller.

During 2017, the number of USD1 billion deals maintained their volume (number of transactions) but notably failed to deliver the mega-deal values established in prior years, falling below the deal values achieved in both 2015 and 2016. It is not expected that 2018 will deliver such deal values either as many sectors have reached a point where regulatory constraints may challenge further consolidation at a large scale.

However, the rise in the M&A market of state-owned oil and gas enterprises moving downstream, rising feedstock prices, and pressure on margins is likely to propel scale and synergy-driven M&A plays as well as portfolio rebalancing amongst traditional commodity chemical players. Consolidation is also likely to continue in more fragmented sectors of specialty chemicals such as the adhesives and sealants sub-sectors. Meanwhile, strong M&A appetites of large players, competition regulator-mandated divestitures, and portfolio realignment resulting from past mega-deals drive M&A transactions.

Activist investors continue to make their presence known in the industry, making a significant impact on the chemical M&A market, both in terms of shaping deals as well as blocking deals from happening. They are expected to continue pressuring companies to focus on core competencies to achieve additional returns on top of historically high valuations, further fueling M&A activity in 2018.
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Yara International opens the worlds largest Diesel Exhaust Fluid plant

MOSCOW (MRC) -- Yara International has opened the world's largest DEF (diesel exhaust fluid) plant in Brunsbuttel, Germany, under the brand-name AdBlue, as per Hydrocarbonprocessing.

DEF is a fluid used to remove harmful NOx emissions from diesel engines and Yara is the global leading producer of DEF.

“AdBlue is a fluid used to remove harmful NOx emissions from diesel engines. This project is in line with our mission to protect the planet, and a response to the need for clean air. Yara Brunsbuttel, one of five Yara AdBlue plants worldwide, now has the capacity to remove approximately half a million tons of NOx. This equals the entire NOx emissions from the road transport sector in Germany, Austria and Switzerland combined,” says Svein Tore Holsether, President & CEO.

The new production capacity includes a new deep sea ship loading facility, a fully automated truck loading station operating 24/7 with a digitalized unmanned gate and a 17,500 m3 AdBlue tank. This is the world’s largest storage tank for AdBlue. AdBlue is a high quality urea solution that is injected into the Selective Catalytic Reduction (SCR) catalyst on diesel vehicles and machinery, turning dangerous NOx emissions into harmless water vapor and nitrogen. It allows truck and car drivers to meet the stringent European Union and US restrictions on exhaust gas emissions.

The increased need for AdBlue in the segment of heavy duty vehicles and passenger cars in Europe and the US makes a reliable supply and on-time delivery crucial for our customers. We are committed to answering their needs. The new facilities confirm Yara’s position as the leading and reliable AdBlue supplier,” says Holsether.

The 28 million Euro investment project was executed according to plan, in less than three years, within budget, and with no safety incidents.

“This has been a true collaboration project involving many Yara segments and more than 50 different external companies. The successful completion means that we from Yara Brunsbuttel now can ensure reliable and continuous supply of AdBlue to Europe and the US. Our fully automated and flexible facility means that customers can get whatever volume and concentration, at any time,” says Julia Lindland, Managing Director Yara Brunsbuttel GmbH.

"With annual DEF demand forecasted to top 1.7 billion gallons by 2026, our ongoing partnership with Yara enables us to offer customers Air1, the highest quality DEF on the market," explains Andy Austin, SVP of Specialty Products for Mansfield Energy. "The completion of this expansive plant demonstrates Yara's ongoing commitment to meet our customers' growing demand across North America."

In 2010, the EPA passed the Clean Air Act which made heavy duty diesel engines comply with stringent emission regulations to reduce NOx emissions. The most efficient way to meet these regulations is to use SCR technology which requires DEF as the operating fluid. Boosting the demand for DEF, virtually all new diesel engines including semi-trucks, off road machinery, boats and an increasing number of diesel passenger cars, will use SCR technology.
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Tasnee plans to complete maintenance at PP plant in Al-Jubail

MOSCOW (MRC) -- National Industrialization Company (Tasnee) is likely to resume operations at its polypropylene (PP) plant in Al-Jubail, as per Apic-online.

A Polymerupdate source in Saudi Arabia informed that the company has planned to turnaround in end-February 2018. The plant was taken off-line for maintenance on February 10, 2018.

Located at Al-Jubail in Saudi Arabia, the plant has a production capacity of 720,000 mt/year.

As MRC informed before, in 2013, Clariant, a world leader in specialty chemicals, and Tasnee announced the signing of an agreement to establish a masterbatches joint venture in Saudi Arabia. Within the framework of the agreement, through its 100% subsidiary Rowad National Plastic Company Ltd., Tasnee acquired a 40% stake in Clariant’s masterbatches operations in the country, already operating under the name Clariant Masterbatches (Saudi Arabia) Ltd.

Headquartered in Riyadh, Tasnee is primarily engaged in petrochemical, chemical and industrial projects. The
company produces petrochemical products, including polypropylene, polyethylene and acrylic acid, as well as other downstream petrochemical products.
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PlasChem Park in Saudi Arabia witnesses steady investor interest

MOSCOW (MRC) -- Sadara Chemical Company (Sadara) has signed an agreement to supply SADIG-ILCO, a new Saudi-German joint venture focused on the manufacture of a wide range of specialty chemicals, with ethylene oxide (EO) and propylene oxide (PO), according to GV.

Under the terms of the supply agreement, SADIG-ILCO’s new PlasChem Park facility will offtake EO and PO from Sadara through the EO and PO pipelines that are being established by Sadara. Using these products as feedstock, the company will manufacture a range of specialty chemicals, some of which will be produced for the first time in the Kingdom of Saudi Arabia. This will further enable the production of market-ready products in several areas, including coatings and adhesives, personal care products and many other industrial applications.

Commenting on the supply agreement, Mohammad Alazzaz, Director of Value Park for Sadara, highlighted the investment opportunities available with the new value chains being produced by the Sadara Chemical Complex, saying, "With Sadara’s products now in the local, regional and global markets, we are able to show investors definitively that the Kingdom is an attractive destination for new and exciting downstream manufacturing opportunities. The specialty chemicals that SADIG-ILCO will produce locally will replace imports and encourage development of new downstream specialty industries. I am pleased to see that Sadara’s investment in the EO and PO pipelines for PlasChem Park by Sadara, coupled with other Kingdom and PlasChem Park specific incentives, have already helped to attract a number of EO and PO investors."

Eng. Ahmad Alubaid, Managing Director, SADIG Industries, highlighted that, "The project is in line with Saudi Vision 2030 and we are thankful for the supportive role of the Ministry of Energy, Industry and Mineral Resources. In addition, we appreciate and thank Sadara for aligning with the vision of developing downstream industries. The EO/PO project is part of SADIG Industries’ growth strategy, and will bring technical know-how to manufacture specialty chemicals in the Kingdom and create quality long-term stable job opportunities. The EO/PO project is part of our third generation project line-up, with an investment of approximately USD 40 million. It forms a key part of a number of projects we are currently working on with a total investment of approximately USD 300 million through which we aim to create more than 300 direct quality jobs. We envision that the project will introduce new chemicals that will enable further downstream industries in the Kingdom and will add value to the local economy and the country’s export portfolio."

Dr. Corvin Volkholz, Technical Director, ILCO, added, "We believe diversification to the existing chemical market in the Kingdom will open new opportunities for further expansion of the Kingdom’s specialty chemicals industry. SADIG-ILCO will allow us to tap the region’s growing demand and expand into Saudi Arabia, as well as the other regional markets. By combining our downstream manufacturing experience and technical expertise with Sadara’s specialty chemicals value chain, we will be able to bring many new and exciting products to the Kingdom."

PlasChem Park is a 12 sq km industrial park in Jubail Industrial City II, dedicated to downstream chemical and conversion industries. PlasChem Park is a key element differentiating Sadara from other petrochemical, chemical and plastics manufacturing projects in Saudi Arabia. It is uniquely positioned to enable and support downstream opportunities in many market segments, including the Hydrocarbon Resin Cluster, Ethylene Oxide/Propylene Oxide (EO/PO) Cluster, Polyurethane Cluster and a Plastics Cluster. These clusters are designed to attract diversified investments into PlasChem Park for downstream applications such as the production of oil and gas chemicals, construction materials, auto components, animal feed, paints and coatings, as well as home and personal care products. There are currently two downstream investments operating in Jubail Industrial City II and several existing investors in the PlasChem Park will conclude their planned project engineering activities by early 2018 with ground-breaking activities set to take place in the third quarter of 2018.
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