Incoming BASF boss rules out DowDuPont-style break-up

MOSCOW (MRC) -- The incoming boss of BASF has thrown his weight behind the chemical titan's contentious strategy of keeping divergent businesses folded into one company, at a time when its major rivals such as DowDuPont are breaking themselves up, as per Reuters.

The comments from Martin Brudermueller, who will take over as CEO on Friday, provide clarity on a key strategic issue that is dividing investors, in marked contrast to predecessor Kurt Bock who would not be drawn on which path he favoured.

The German group has grown from a 19th century indigo dye workshop to a diversified juggernaut worth USD95 billion. It is the only major Western chemicals player banking on an integrated value chain - which it dubs "Verbund" - where a company owns businesses throughout the production process.

"We often hear the Verbund getting criticised for being too rigid. That's not true," said 56-year-old Brudermueller. "If you have everything under one roof, you can coordinate things much better, that is the sense in which we will develop it further. You wouldn't normally want to sell attractive businesses that are growing," he told Reuters and other reporters in remarks released.

At its Ludwigshafen headquarters and at five other hubs abroad, BASF runs close-knit networks of chemical reactors that churn out products as diverse as basic commodities, coatings, vitamins, drug ingredients and engineering plastics.

Bock, when asked in February whether BASF would continue to have diverse businesses under one roof or was considering other options, said the company might learn from what rivals did but did not say which path he favoured.

Both strategies have potential advantages; break-ups can create more focused individual companies and allow stronger units to attract investors unshackled from weaker ones, while an integrated model can reduce costs.

U.S. rival DowDuPont is planning to break up into a Materials Science division that relies on in-house basic petrochemicals plants and a Specialty Products unit selling more differentiated and complex materials. A third spin-off will focus on agriculture.

In other recent separation deals in the industry, Bayer spun off its Covestro plastics unit and is now selling down the shares, Air Products spun-off specialty chemicals unit Versum and coatings group Akzo Nobel is selling its specialty chemicals division.

BASF competes with DowDuPont in areas such as pesticides, engineering plastics, nutrition, insulation foams and petrochemicals. Its rival's three-way split will restore BASF's position as the world's largest chemical maker but some investors and analysts would rather see it lose that crown.
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Formosa Plastics announces process technologies for Texas PE & PP production expansions

MOSCOW (MRC) – Formosa Plastics Corporation, U.S.A. announced the process technologies being used for the polyethylene and polypropylene production expansions in Point Comfort, Texas, as per Hydrocarbonprocessing.

• The new tubular low-density polyethylene (LDPE) plant’s technology has been licensed from ExxonMobil Catalysts and Licensing, LLC; the plant will have a production capacity of 400,000 MT/year.

• The new dual-purpose polyethylene (PE) plant’s technology will use UNIPOLTM PE Process technology, licensed from Univation Technologies, LLC. The plant will be able to produce both high-density polyethylene (HDPE) and linear low-density polyethylene (LLDPE), with a combined production capacity of 400,000 MT/year.

• The new polypropylene (PP) plant’s technology has been licensed from Japan Polypropylene Corporation (JPP); the plant will add 250,000 MT/year of capacity to the site’s current PP production.

The addition of these three process technologies and plants at Point Comfort will expand the company’s product offerings and increase production flexibility. The LDPE plant will initiate the company’s entry into the North American LDPE market. The ExxonMobil technology is recognized for producing high-quality resins safely and reliably. Univation Technologies’ UNIPOLTM PE Process is world-renowned for producing outstanding HDPE and LLDPE resins. Since our first JPP license in 2001, our PP product offerings have expanded to include high impact copolymer and random copolymer resins.

"We look forward to introducing our new line of Formolene® LDPE resins and expanding our current Formolene® HDPE and LLDPE product lines,” states Ken Mounger, Vice President & General Manager, Polyolefins. “Our additional supply of Formolene® polypropylene will enable us to grow in key strategic markets, too."
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Evonik increases prices for superabsorbent polymers

MOSCOW (MRC) -- Evonik raised the prices for its superabsorbent polymers, offered in Europe and the Americas, up to 15% with effect as of 4 May, 2018, as per the company's press release.

All existing contracts will be honored and are not affected by the price increase.

The price increase has become unavoidable to compensate higher raw material costs.

This adjustment will enable the business line Baby Care to continue to provide to its customers a superior quality, excellent service with special focus on supply reliability.

As MRC informed previously, Evonik Resource Efficiency invested in a capacity expansion of its performance foams business at its production site in Darmstadt, Germany. The investment increased the output of the facility by about 20% as a first step. The Group will be adding production equipment to its operations complex that manufactures products marketed under the Rohacell brand. The expanded production capacity was expected to be operational by the second half of 2017.

Evonik, the creative industrial group from Germany, is one of the world leaders in specialty chemicals. Its activities focus on the key megatrends health, nutrition, resource efficiency and globalization. Evonik benefits specifically from its innovative prowess and integrated technology platforms. Evonik is active in over 100 countries around the world.
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Petrobras begins binding phase for Pasadena refinery sale

MOSCOW (MRC) -- Petroleo Brasileiro SA (Petrobras) has started the binding phase of its earlier announced proposal to sell subsidiary Pasadena Refining Systems Inc.’s (PRSI) refinery in Pasadena, Tex., said Ogj.

At this stage of the project, process letters are issued to potential undisclosed buyers qualified in the previous phase with instructions about the divestment process, including the guidelines to conduct due diligence and submit binding offers, Petrobras said on May 4.

Petrobras formally is seeking a qualified buyer for affiliate Petrobras America Inc.’s (PAI) interest in the entire Pasadena refining operations system, the sale of which includes PAI’s stake in PRSI, PRSI Trading LLC (PRST), and PRSI Real Property Holdings LLC (REAL).

Alongside the 110,000-b/d Pasadena refinery, the transaction will include sale of 5.1 million bbl of oil and products storage capacity, an associated marine terminal and logistics system, existing inventory, and land on the Houston Ship Channel usable for potential future expansion.
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Wacker opens new production site for silicones in South Korea

MOSCOW (MRC) -- Wacker Chemie AG has opened a new production site for silicone elastomers in South Korea, as per Hydrocarbonprocessing.

The plant is located around 100 kilometers southeast of Seoul at Jincheon, where the Group has already been producing silicone sealants since 2010 and specialty silicones for the electronics industry since 2012. In moving to the new site, WACKER is significantly expanding its production and therefore its position as a leading silicone manufacturer in the region. Some EUR15 million has been invested in the new production site.

"The opening of our new plant is a milestone for us and sends a signal to our customers that we want to continue growing in Asia and in South Korea especially," said Executive Board member Christian Hartel at the opening ceremony, which was attended by high-ranking officials and business partners. Asia is already one of the Group’s most important sales regions. "We generate around 40 percent of our sales in Asia. Our operations in South Korea play a key role here", said Hartel. "Our new production site enables us to strengthen and expand our position in the region over the long term."

Wacker has produced silicone sealants in Jincheon since 2010 and has also manufactured specialty silicone elastomers there for the electronics industry since 2012. "Due to the strong growth in demand for our silicones, production was increasingly being stretched to its limits", explained Executive Board member Auguste Willems. As it was not possible to expand the facilities on the existing premises, Wacker decided to move sites. "Our new plant in Jincheon is four times as big as the old one and provides enough space for future capacity expansions", he said.

The centerpiece of the new site is a 13,000 square meter production building. Silicone sealants for the construction industry and specialty silicone elastomers for electronic applications will be manufactured in separate facilities. The production lines have been equipped with cutting-edge manufacturing technology that enables fully automatic and therefore highly efficient production processes. Hyperpure silicones are produced and packaged in a dedicated cleanroom - a service that is becoming increasingly important for customers from the electronics industry in particular.

"Jincheon offers the space and technical facilities we need to meet the rising demand for silicones in the region long term. That applies both to our sealants and to our high-performance silicones, which our customers use to produce automotive displays or use in other demanding electronic applications", emphasized Willems. "With this investment, we can broaden the regional scope of our silicones business continuously and strengthen our presence as a leading silicone manufacturer in South Korea and Asia."

As MRC wrote before, Wacker Chemie AG is expanding its existing production plants for dispersions and dispersible polymer powders in South Korea. The Group is building a new spray dryer for dispersible polymer powders at its Ulsan site, which will have a total capacity of 80,000 metric tons per year. The Munich-based chemicals company is also constructing an additional reactor for dispersions based on vinyl acetate-ethylene copolymer (EVA), which are needed as the raw material for the spray dryer to produce dispersible polymer powders.

Wacker Chemie AG is a worldwide operating company in the chemical business, founded 1914. The company is controlled by the Wacker-family holding more than 50 percent of the shares. The corporation is operating more than 25 production sites in Europe, Asia, and the Americas. The product range includes silicone rubbers, polymer products like ethylene vinyl acetate redispersible polymer powder, chemical materials, polysilicon and wafers for semiconductor industry.
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