SABIC signs MOU with Clariant outlining intended transaction

MOSCOW (MRC) -- SABIC, the world’s third largest diversified petrochemicals company, has announced that it is taking steps to establish certain elements of its Specialties business as a stand-alone business, as per the company's press release.

The strategic purpose of this is to prepare the Specialties business to participate in further organic and inorganic growth, including a transaction under discussion with Clariant AG, for which both companies have signed a Memorandum of Understanding (MOU). The MOU would enable Clariant to create a new, "High Performance Materials" specialty chemicals business as an exceptional global platform for growth.

The process to create SABIC’s stand-alone Specialties business is anticipated to take until the end of 2019. Then, if the transaction with Clariant proceeds, parts of SABIC’s Specialties business - comprising its unique ULTEM and NORYL resins, and its families of LNP compounds and copolymers - would be merged with Clariant’s additives and high value masterbatch offerings, as part of the Clariant group, making Clariant a uniquely positioned and competitively advantaged provider of customer-specific high performance materials and solutions in the specialty chemicals industry, headquartered in Switzerland and listed on the SIX Swiss Exchange.

Yousef Al-Benyan, Vice Chairman and CEO, said, "The establishment of SABIC Specialties as a stand-alone business, together with the MOU with Clariant, represent part of SABIC's long-term growth and diversification strategy. SABIC has a long and strong track record of growing businesses through joint ventures and co-investment in both listed and private companies. Uncoupling the Specialties business will allow the unit to achieve accelerated organic and inorganic growth as aligned with our broader corporate strategy of creating a sizeable, world class Specialties company while creating additional value for our shareholders, customers and talented employees."

Al-Benyan continued, "For many years, SABIC and Clariant have created value for our respective shareholders from our close commercial ties. We will now seek to further develop this strategic relationship at the highest levels of both companies to create a leading provider of tailored specialty materials and technologies for the benefit of both companies’ stakeholders and the advancement of the specialties industry."

"Clariant and SABIC's existing Specialties business are complementary, and the investment in Clariant, together with the intended combination of portions of our respective specialty businesses, is well aligned with SABIC's strategy to open new growth opportunities in specialty chemicals," Al-Benyan noted.

This announcement follows the recent regulatory approvals of SABIC’s acquisition of its 24.99% interest in Clariant, making SABIC the Swiss specialty chemicals company’s largest shareholder. SABIC currently has no plans to launch or otherwise effect a full takeover of Clariant AG.

Following completion of the intended transaction, Clariant would form a new "High Performance Materials" business area as an exceptional global platform for growth. This platform, together with anticipated cost synergies and operating efficiencies, aims to increase value for both companies’ stakeholders. The intended transaction would unlock the value of both companies’ specialties offerings. The intended transaction is envisaged to be signed during 2019 and to close at the beginning of 2020, subject to regulatory approvals.

SABIC’s Specialties materials can be found in applications for smart electronics, healthcare, aerospace, automotive, robotics, additive manufacturing, and e-mobility. Each area of focus demands adherence to stringent customer specifications in demanding thermo-electro-mechanical environments, as well as the ability to meet regulatory requirements, which can only be fulfilled with unique technologies and formulation know-how.

As MRC wrote before, in January 2018, SABIC, a world leader in chemicals, agreed to acquire approximately 83 million shares in Clariant from 40 North and Corvex Management.

Saudi Basic Industries Corporation (Sabic) ranks among the world's top petrochemical companies. The company is among the worldпїЅs market leaders in the production of polyethylene, polypropylene and other advanced thermoplastics, glycols, methanol and fertilizers.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints. Clariant India has local masterbatch production activities at Rania, Kalol and Nandesari (Gujarat) and Vashere (Maharashtra) sites in India.
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MOSCOW (MRC) -- Rehau, a family-owned supplier of polymer-based solutions to the construction and automotive industries headquartered in Muri, Switzerland, has announced plans to acquire polymer distributor MB Barter & Trading AG, also of Switzerland, for an undisclosed amount, said Canplastics.

The deal, which is expected to close before the end of this year, will create a new, independent company with a volume of USD2.5 billion, Rehau said in a statement. The transaction includes Rehau GmbH in Muri bei Bern, Switzerland, as well as the worldwide subsidiaries of the MB Barter & Trading Group.

MB Barter is a global distributor of commodity polymers, PET, and rubber globally. The company has 30 offices worldwide.

"Decades of Rehau’s experience in materials, processes and applications [will combine] with the relevant trading and distribution expertise of MB Barter & Trading, with 30 locations worldwide, its reputation as a highly reliable full-service provider and its established relationships with suppliers and customers," Rehau said in its statement.

The name of the new company has not yet been announced.
MRC

MOSCOW (MRC) -- Sabic installed one of its managers as chief executive officer of the Swiss chemicals maker Clariant and gained four seats on the board, said Bloomberg.

Ernesto Occhiello, a Sabic executive who came from Dow Chemical Co., will take the helm on Oct. 16, as outgoing CEO Hariolf Kottmann moves to become chairman. Muttenz, Switzerland-based Clariant also announced a merger of assets with Sabic to create a stronger plastics business. Investors applauded the move, sending Clariant shares up as much as 8.1 percent, the most in almost 16 months.

The changes could bring some stability to Clariant, which was the subject of recurring takeover speculation during the past decade that culminated in a failed merger with Huntsman Corp. and an attempt last year by an activist investor to break up the company. Instead, Sabic swooped in and bought a 25 percent holding.

"Clariant’s shares have lacked real momentum since the Huntsman deal was called off but today’s announcement gives the shares the convincing equity story they need," said Barclays analyst Alex Stewart.

The two makers of specialty chemicals have been locked in talks on how to leverage their relationship. Riyadh-based Sabic acquired General Electric Co.’s plastics division for USD11.6 billion a decade ago, with the operations now fitting with Clariant’s masterbatches and plastic compounding assets.

Saudi Basic Industries Corporation (Sabic) ranks among the world's top petrochemical companies. The company is among the worldпїЅs market leaders in the production of polyethylene, polypropylene and other advanced thermoplastics, glycols, methanol and fertilizers.
MRC

MOSCOW (MRC) -- Shanghai Golden Phillips Petrochemical Co has restarted a high density polyethylene (HDPE) plant, as per Apic-online.

A Polymerupdate source in China informed that the company has resumed operations at the plant on September 12, 2018. The plant was shut for maintenance turnaround on August 14, 2018.

Located in Shanghai, China, the HDPE plant has a production capacity of 135,000 mt/year.

As MRC reported earlier, the company shut down its HDPE plant in Shanghai from end-May to 13 June, 2017, owing to a lack of feedstock availability.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group's key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.
MRC

MOSCOW (MRC) -- Danish brewer Carlsberg says it will cut the amount of plastic used in traditional multi-packs by as much as 76 per cent by using glue to replace the plastic wrapping that holds together its six-packs of cans, as per Canplastics.

When rolled out, the new Snap Pack packaging will reduce plastic waste by over 1,200 tons per year, which is equivalent to 60 million plastic bags, Carlsberg said.

According to Carlsberg, the Snap Pack’s glue is strong enough to keep the cans together during transport and storage, but is easily pulled apart by the consumer when so desired.

"We’re constantly in pursuit of new ways to make probably the best beer in the world even better," Carlsberg said in a press release. "And not just the way it tastes. To reduce waste, we’re introducing our new snap pack, which uses a revolutionary glue technology."

The Carlsberg Group is a Danish brewing company founded in 1847 by J. C. Jacobsen with headquarters located in Copenhagen, Denmark. The company's flagship brand is Carlsberg Beer (named after Jacobsen's son Carl) but it also brews Tuborg, Kronenbourg, Somersby cider, Russia's best selling beer Baltika, Belgian Grimbergen abbey beers as well more than 500 local beers.
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