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Braskem says Novonor considering secondary share offering

December 06/2021

MOSCOW (MRC) -- Brazilian industrial conglomerate Novonor is considering exiting its majority stake in petrochemical company Braskem SA via a secondary share offering, said Reuters

Novonor, formerly known as Odebrecht, had previously organized a competitive merger and acquisition process in an attempt to attract bidders for its stake in Braskem. After that process failed, various media outlets, including Reuters, reported that Novonor was planning to exit Braskem via a share offering.

In the latest filing, Braskem said it had received correspondence from Novonor indicating that the company was considering a secondary share offering, though no final decision had been reached.

Braskem added that it would assist Novonor in carrying out studies regarding the possible consequences of the share offering.

These include the improvements to corporate governance practices, as well as other measure necessary for Braskems possible migration to being listed on the Novo Mercado segment of the B3 Brazils stock exchange located in Sao Paolo.

Novonor formerly known as Odebrecht announced its intention to sell its shares in polyolefins producer Braskem in August 2020, to fulfil commitments made to creditors before and during its bankruptcy.

We remind that Brazilian petrochemical producer Braskem's 450,000 mt/year PP plant in LaPorte, Texas, along the Houston Ship Channel completed its initial commercial production, as per the company's statement as of Sept. 10. "The launch of commercial production at our new world-class PP production line in La Porte clearly affirms Braskem's position as the North American polypropylene market leader," Braskem America CEO Mark Nikolich said in a statement. With a USD750 million investment, the new PP plant's construction started in October 2017 and was completed in June, 2020.

Braskem operates five other US PP plants in Texas, Pennsylvania, and West Virginia, with a cumulative capacity of 1.57 million mt/year that the company acquired. The new plant in La Porte, Texas, is Braskem America's first PP new build.

According to MRC's ScanPlast report, Russian producers' October PP production fell to 155,500 tonnes from 169,700 tonnes a month earlier, three producers shut its production for  scheduled maintenance. Russia"s overall PP output reached 1.693 mln tonnes in January-October 2021, compared to 1.530 tonnes a year earlier. Four out of seven producers increased their capacity utilisation, with SIBUR Tobolsk/ZapSibNeftekhim traditionally accounting for the greatest growth in the output.

Braskem S.A. produces petrochemicals and generates electricity. The Company produces ethylene, propylene, benzene, toluene, xylenes, butadiene, butene, isoprene, dicyclopentediene, MTBE, caprolactam, ammonium sulfate, cyclohexene, polyethylene theraphtalat, polyethylene, and polyvinyl chloride (PVC).
Author:Anna Larionova
Tags:petroleum products, crude oil, PP, PE, neftegaz, petrochemistry, Braskem.
Category:General News
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