Oxide Acquires BP Chemicals' European Acetate Business
On the 17th December 2001, INEOS Oxide acquired BP Chemicals' European Acetate Esters Business; subject to competition authority approvals. Completion is expected in February 2002.
Included in the deal is the acetate ester plant located on INEOS Oxide's site in Antwerp, goodwill and technology license. Financial details were not disclosed.
Bill Reid INEOS Oxide CEO commented "We are very pleased to have acquired this business and the associated assets, not only because it is Europe's largest plant of this type but also because of the significant synergy these products bring INEOS Oxide in the solvents sector. The family of butyl and isopropyl acetate esters fit nicely into our expanding solvents portfolio of glycol ethers and glycol ether esters and greatly enhances our offering to this important customer base. Having operated the unit on behalf of BP for the past six years, our new customers should experience a seamless transition of ownership."
This acetate esters business is the largest in Europe; other important export markets being those in the Far East and the Americas. On completion, the acetate esters business will be managed by Rob Ingram (tel no: +44 7788 974 003) along with the glycol ethers/glycol ester business.
UK Ineos buys Degussa's German Methanova unit
Germany's Degussa Wednesday said it would sell its unit Methanova GmbH to UK-based Ineos effective Jun 30 for an undisclosed price. The specialty chemicals company said the move was in line with its previously announced strategy to divest non-core operations and focus on its specialty business.
In 2002, Methanova generated sales of around Eur45-mil ($51-mil). It employs 170 staff. There was no word from either firm on the possibility of any job cuts. Methanova, based in Mainz-Mombach, Germany, produces methanol derivatives such as formaldehyde and paraformaldehyde, which are used in the production of phenolic, urea and melamine resin. Ineos is a global manufacturer of specialty and commodity chemicals. It employs roughly 10,000 people at 60 locations in 16 countries, and generated sales of roughly Eur5-bil in 2002.
Chemical Week Aug 04,
Ineos Secures Funding for U.K. Chlor-Alkali Upgrade
Ineos Chlor says it has obtained a £155-million ($251 million) financing package for a previously announced upgrade of its chlor-alkali complex at Runcorn, U.K. for completion in 2007. ICI, which holds 15% of Ineos Chlor, is contributing £60 million, and Ineos Capital, which holds the balance, will contribute £45 million. The U.K. government will provide a £40-million grant and £10 million in loans under a regional assistance scheme, subject to antitrust clearance from the European Commission. The total project cost is £390 million; Ineos Chlor will cover the shortfall from internal resources, says CEO Tom Crotty. Ineos Chlor will convert the 620,000-m.t./year mercury cell plant to membrane technology, using its Bichlor process; replace a boiler in the plant's power station; and modernize derivative plants that produce chloromethanes; methylene chloride; chloroform; and perchloroethylene and trichloroethylene, Crotty says. The Runcorn chlorine plant supplies more than 80% of the U.K.'s chlorine and caustic soda.
clears proposed acquisition of BP's Dormagen business by INEOS
The European Commission
has today cleared the way for INEOS to acquire BP's Ethylene
Oxide/Ethylene Glycol business in Dormagen, Germany. Following an in-depth
investigation the Commission has concluded that the proposed
acquisition would not significantly impede competition in the
European Economic Area (EEA) or a substantial part of it.
The decision was welcomed by INEOS. "We are pleased that the Commission has reached this conclusion," commented Hans Casier CEO INEOS Oxide. "We have always maintained that although INEOS would have a high market share, competition would not be significantly impeded as a result of the acquisition of the business. A view that has been confirmed by the announcement made today."
"The addition of the Ethylene Oxide business at Dormagen will help INEOS Oxide to continue to meet the needs of its customers. Our focus now is on a successful acquisition of the business and seamless transition into the INEOS Group of companies," he added.
In its statement the Commission commented that the combined entity would have high market shares in the merchant market for ethylene oxide. However, the investigation revealed that competitors would have the ability and the incentive to react to potential price increases by INEOS. In addition, substantial new capacity for ethylene glycols is being commissioned in the Middle and Far East, producing ethylene glycols at substantially lower costs than in Europe. As a result, imports of ethylene glycols into the EEA market will increase. Given the number of market players and their ability to divert part of their ethylene glycols production into the ethylene oxide merchant market, the Commission concluded that there would be sufficient alternative suppliers.
Notes to editors:
The BP Dormagen Business consists of a plant located in Koln/Dormagen (Germany) manufacturing ethylene oxide and ethylene glycols and is currently controlled by BP.
Ethylene oxide is a colourless gas, produced by the partial oxidation of ethylene and is hazardous, highly inflammable, explosive, toxic and carcinogenic. Ethylene oxide is used for the production of glycols, mainly used in the textile industry, and as an intermediate for the production of other derivatives, such as detergents, refrigerants or personal care among.
INEOS has 68 manufacturing facilities across 14 countries throughout the world. With 15,600 employees, the Company produces more than 30 million tonnes of petrochemicals, 20 million tons per annum of crude oil refined products (fuels) and sales of around $33bn.
INEOS Enterprises announces strategy for significant growth of its European biodiesel business and confirms major biodiesel investment for Grangemouth
Enterprises has today announced a strategy to achieve significant
growth of its biodiesel business across Europe. The first step of
this strategy will be to achieve at least 2 million tonnes
of biodiesel output by 2012, with some 1.2 million tonnes by
This strategy is in line with the pan European commitment by governments to move towards increased use of green fuels and is underpinned by major plant investments proposed by INEOS Enterprises for the UK and Continental Europe.
Comments Harry Deans, CEO INEOS Enterprises: "INEOS Enterprises is aiming to become the first truly pan European supplier of biodiesel to meet the significant growth in demand predicted for Europe. We will build world scale plants using the latest technology to produce high quality products that will be highly competitive in all market conditions.
In the UK, INEOS Enterprises can today confirm that its investment in a new biodiesel production facility at Grangemouth, Scotland will proceed, with significant support being received from the Scottish Executive in the form of a Regional Selective Assistance award. INEOS Enterprises anticipates that the facility, which will be at least 500,000tes, will be operational by 2008.
Comments Mr Deans: "We are delighted to have been able to work with the Scottish Executive and other key stakeholders to bring this very important investment to Scotland. The Grangemouth plant will be fundamental to our growth strategy and represents an investment of over ?90 million in the region. The UK is fully committed to the increased use of biofuels as part of its energy mix and we believe that this investment will make an important contribution towards this.
In addition to the Grangemouth investment, the growth strategy will see additional investments proposed by INEOS Enterprises, potentially at the INEOS sites at Antwerp (Belgium), Lavera (France), and Wilhelmshaven (Germany) or Cologne (Germany).
Continues Mr Deans: "Unlike other regional producers, our strategy will see new production facilities located at the very heart of key demand centres. The existing INEOS operations within these centres would provide us with cost effective infrastructure, a ready-made and fully integrated customer base in addition to access to some of Europe's very best transport networks. Building upon this platform, our intention is to drive our capital investment with an aggressive business development strategy to capture significant market share across Europe. We are already in discussions with a number of oil majors and supermarket giants to secure this additional demand.
INEOS Enterprises has more than 10 years experience in the biodiesel sector, and already holds a strong position in the French market, which is to be further strengthened by an ongoing ?70 million investment to double biodiesel output at its site at Baleycourt by 2008.
Andy Currie, Director of INEOS Capital and Chairman of INEOS Enterprises comments: "As part of the world's fastest growing chemicals company, INEOS Enterprises is extremely well placed to make these investments and has an excellent track record of pursuing market opportunities and developing world class businesses.
"INEOS is well skilled in commissioning and operating low cost, high yield commodity plants and has the size and scale that is essential for success in this business. By building on the ready made synergies with our existing European refining operations, coupled with our existing client base and market contacts, we firmly believe that we have the competitive edge and can develop into Europe's premier biodiesel company.
Notes to Editors
INEOS is a leading global manufacturer of refined products and basic, intermediate and speciality chemicals. The Company is made up of multiple decentralised businesses, each with a major chemicals company heritage.
The INEOS production network spans 68 manufacturing facilities in Europe, North America, South America, Asia and Africa. The combined INEOS Group, which includes the recently acquired Innovene (BP) people and assets, generates more than $33bn in revenues and has more than 15,000 employees. This makes INEOS the third largest independent chemicals company in the world and the largest in the UK, as well as the country's largest private company.
INEOS Enterprises is a portfolio of eight leading businesses manufacturing chemical products in Northern Europe and Southeast Asia, with sales of these products to customers around the world. The Company is focused on the developing needs of customers and rapid growth through investment in new products and manufacturing facilities or by acquisition. INEOS Enterprises employs some 500 people across sites in the UK, France, Germany and Thailand and has an annual turnover in excess of Euro600 million.
The crude oil refineries at Grangemouth and Lavera are operated by INEOS Refining, which is the largest independent refiner in the EU. The Grangemouth refinery supplies ultra low sulphur diesel and petrol to the fuels markets of Scotland and northern England, whilst the Lavera refinery supplies the fuels markets of France, Switzerland and southern Germany. Investment in biodiesel at both of these sites would provide INEOS Enterprises with excellent customer/supplier synergies.
The INEOS site at Baleycourt is operated by INEOS Enterprises and has been producing biodiesel for more than 10 years. The site is in the heart of France's second largest vegetable oil producing region, and the new investment currently underway at the site will allow around 400,000 tonnes of locally produced rapeseed to be transformed into oil and then biodiesel for supply to the French, Belgian and German fuels markets.
The INEOS site at Antwerp is operated by INEOS Oxide. It has a strategic location at the heart of Europe's largest and the world's second largest petrochemical centre with close proximity to raw materials via sea, road and rail and to Europe's prime customer base via pipeline, sea, inland waterway, rail and road transportation networks. Investment in biodiesel at Antwerp would provide INEOS Enterprises with an excellent supply point for Northwest Europe, and with excellent customer/supplier synergies with the adjacent refining operations.
In Germany, the INEOS site at Wilhelmshaven is operated by INEOS ChlorVinyls and produces chlorine and caustic soda, along with S-PCV and VCM for use in the PVC chain. Investment in a biodiesel facility at the site would present INEOS Enterprises with excellent logistics opportunities to supply the German fuels market.
The INEOS site at Cologne, Germany employs around 1,800 people in the manufacture of petrochemical products such as ethylene, ethylene oxide, ethylene glycol, polyethylene, propylene, propylene oxide, propylene glycols, acrylonitrile, butadiene, C4 oligomers, isoamylene, benzene, toluene, ammonia and nitric acid.
Biofuels are sources of energy that are manufactured from renewable resources, for example rapeseed. Specifically, biodiesel is an alternative fuel produced from renewable sources such as vegetable oils that can be blended with diesel and used to power conventional diesel engines without modification. It can also be used as a replacement fuel for oil in industrial processes.
INEOS Enterprises Announces Plans for Major Investment in New Biodiesel Facility at Port of Antwerp
INEOS Enterprises has today announced details of its proposals for a major investment in a new biodiesel facility at the INEOS site at Zwijndrecht in the Port of Antwerp. The investment, which will be in excess of Euro 90 million, forms part of the Company's strategy to deliver significant growth and become the premier supplier of biodiesel across Europe. The Company expects the plant to be operational by early 2009.
The new facility, which will have a capacity of at least 500,000 tonnes per annum, intends to use a good proportion of feedstock sourced from Belgian suppliers. It will have the capability of providing secure biodiesel supplies to the entire Belgian biofuels market in addition to supplying further afield across Europe. The facility would also use glycerine as a bi-product of biodiesel production to stimulate the development of glycerine technology at the site. In parallel to this investment by INEOS, a third party investment in a new vegetable oil extraction facility is also being planned in the vicinity, bringing about further synergies, and leading to the creation of a regional ‘bio-hub'.
Comments INEOS Enterprises CEO Harry Deans: "This represents one of the largest single investments in Belgium in recent years. We expect the project to create a significant number of new jobs at the Antwerp site, whilst supporting indirectly over 600 jobs in the region during construction, therefore making a significant economic contribution to both the local and regional economy.
"The Antwerp site is core to our strategy and will be the centre from where we will lead our growth in biodiesel across the Continent. Our aim is to become the first truly pan European supplier of biodiesel, the first part of which will be to achieve at least 2 million tonnes of biodiesel output by 2012. We will do this by investing in world scale plants such as that proposed for Antwerp, which will use the latest technology to produce high quality products that will be highly competitive in all market conditions.
"Our choice in Antwerp reflects our strategy to invest in new production facilities located at the very heart of key demand centres. The existing INEOS operations within these centres will provide us with cost effective infrastructure, excellent logistics, a ready-made and fully integrated customer base and access to some of Europe's very best transport networks.
Belgium is already home to four very strong INEOS businesses, which between them directly employ some 1,350 people at sites in Zwijndrecht, Lillo, Doel, Geel, Feluy and Neder-Over-Heembeek. The sites also help to secure in excess of 6,000 jobs in ancillary and supporting service industries across the country.
The INEOS site at Zwijndrecht, Antwerp is operated by INEOS Oxide and is positioned at the heart of Europe's largest petrochemical centre with close proximity to raw materials via sea, road and rail and to Europe's prime customer base via pipeline, sea, inland waterway, rail and road transportation networks. The Antwerp site also has its own dedicated jetty, along with a state of the art Cogeneration Unit supplying electricity and steam. The Port is also the main hub of the Western European pipeline network
Comments Dirk Gekiere, Site Director: "The INEOS operations at Antwerp are vital to the future growth of the Port of Antwerp. We have a very experienced, highly skilled team in Belgium that has an excellent track record of delivering major investments at Antwerp. In recent years INEOS has been involved in more than Euro 650 million worth of investment at the site, and this new investment in biodiesel at Antwerp would provide our sister company INEOS Enterprises with an excellent supply point for Northwest Europe, and with excellent customer/supplier synergies with the adjacent refining operations.
The INEOS Enterprises investment is receiving strong support in the region, recognising the importance of the project to the future development of the Port of Antwerp. Eddy Bruyninckx, CEO of the Antwerp Port Authority comments: "We greatly appreciate INEOS' interests in establishing this major biodiesel facility in the Port of Antwerp, thereby taking advantage of the port's logistical platform and the possible synergies with the existing industry. This investment matches the vision we have on the future of the Antwerp Chemical Cluster and we see this as a very important first step in the development of a bio-based chemical industry in the region.
INEOS Enterprises has more than 10 years experience in the biodiesel sector. The Company has already successfully secured government support for its existing biodiesel plant at Baleycourt, which is currently undergoing a Euro 70 million expansion to double output by 2008. INEOS Enterprises also recently secured grant funding in the UK from the Scottish Executive towards the cost of a Euro 90 million biodiesel unit, which will be at least 500,000tes, to be built at the INEOS manufacturing site at Grangemouth, Scotland.
Andy Currie, Director of INEOS Capital and Chairman of INEOS Enterprises comments: "As part of the world's fastest growing chemicals company, INEOS Enterprises is extremely well placed to make these investments and has an excellent track record of pursuing market opportunities and developing world class businesses.
"INEOS is well skilled in commissioning and operating low cost, high yield commodity plants and has the size and scale that is essential for success in this business. By building on the ready made synergies with our existing European refining operations, coupled with our existing client base and market contacts, we firmly believe that we have the competitive edge and can develop into Europe's premier biodiesel company.
Concludes Mr Deans: "We firmly believe that the size and scale of our investment, combined with the strengths of INEOS and the excellent strategic location we have at Antwerp site makes INEOS Enterprises the most appropriate candidate for obtaining Belgium quota for biodiesel.
"We very much look forward to working in partnership with the Belgian government and Belgian feedstock suppliers to bring this major investment to fruition.
INEOS Polyolefins announce Euro150 million investment in European assets.
Polyolefins today announced its intention to invest in excess of
Euro150 million in its European assets over the next three years,
focussed on growing and upgrading its polyolefins capacities.
these investments, we greatly strengthen our market positions in
products where we have a long term competitive advantage and
clearly demonstrate INEOS' determination to build a very robust
business around the high quality people and assets acquired as
part of the Innovene acquisition of late 2005" says Bill
Reid, CEO of INEOS Polyolefins
Polypropylene capacity expansions will take place at its facilities in Geel, Belgium and Grangemouth, Scotland. At Geel a 220 ktpa expansion of the Innovene P gas phase polypropylene unit will increase this unit's capacity to 500ktpa, transforming it into one of the largest units in the world. The smaller slurry/dry flash polypropylene asset at Geel will close later this year. At Grangemouth the 220ktpa liquid pool polypropylene unit will undergo a 30ktpa debottleneck raising its capacitiy to 280ktpa, with a further 30ktpa debottleneck to be implemented when market demand permits.
High density polyethylene capacity expansions will take place at INEOS Polyolefins' Lillo manufacturing site, whereby the capacity of its proprietary bi-modal slurry phase unit will be increased by 200ktpa to 630ktpa. The new capacity which will be in place by 2009 will also make this asset one of the largest in the world. At Grangemouth, given the current situation in plant economics, and provided there are no significant changes in market conditions, the smaller and older of its two gas phase polyethylene units, a HDPE unit, located at this site will close at the end of 2007.
keeping with this far-reaching up-grade of capability, INEOS
Polyolefins is also commiting significant funds to accelarate the
development and commercialisation of advanced linear low density
polyethylene products made via its proprietary metallocene
"INEOS Polyolefins is strongly committed for the long-term to serving the polyolefins market with high quality, cost-effective and innovative products. By implementing this strategy of up-grading and expanding our assets, with an increased focus on high-value, differentiated polymers, we are creating a robust platform that will allow us to maintain our leading market position and ensure the future growth of our business" concludes Bill Reid.
INEOS Phenol to invest in 400,000 tonne phenol acetone plant in China
approval by the National Development Reform Commission (China),
the Ministry of Commerce and the Jiangsu Province Administration
of Industry and Commerce, INEOS Phenol has announced its
intention to invest in a 400,000 tonne phenol plant in
Jiangsu Province, China. The new facility, which will also
produce 250,000 tonnes of acetone, will be solely owned by INEOS and
is expected to be completed at the end of 2009.
It is expected that production from the Zhangjiagang facility will serve the growing market for phenol and acetone in China and will free capacity at the company's European and US plants to meet growth in these regions. The completion of this new plant in China will increase INEOS Phenol's overall annual capacity to over 2.2 million tonnes of phenol and 1.2 million tonnes of acetone.
"When completed, INEOS will be the only company in the world to have phenol and acetone production in Europe, the US and Asia said Alberto Spera, CEO INEOS Phenol. "The new plant will provide a firm foundation for our strategy as we grow capacity to meet the increasing needs of our customers around the world. As well as directly supporting customers in Asia, this plant will also help us to maintain the flexibility and security of supply required by our customers in the US and Europe. We are very pleased to make this step, which will give us a tremendous position in the most dynamic and fast growing market worldwide
This announcement follows closely behind the INEOS agreement, in January, to manufacture HF in Shangrao, Jiangxi Province and reinforces the company's commitment to increase its manufacturing capabilities in Asia, with a particular focus on China.
INEOS Phenol, currently has a nameplate capacity of 1690 ktonnes of phenol and 1050 ktonnes of acetone a year. It has a turnover of around Euro3.2 billion and employs 600 people worldwide. The company is the world's largest producer of Phenol and Acetone and the only manufacturer with production facilities both in Europe and America .
Phenol and Acetone are used in the production of polycarbonate, plastics, phenolic resins, synthetic fibres (such as nylon) and solvents. These products are used in a diverse range of endmarkets, including the automotive, construction, electronics and fibre industries.
INEOS is the world's third largest chemicals company; a leading manufacturer of petrochemicals, specialty chemicals and oil products. Comprising 18 businesses, with a production network spanning 68 manufacturing facilities in 17 countries, the company produces more than 30 million tonnes of petrochemicals, 20 million tons per annum of crude oil refined products (fuels). INEOS employs 15,000 people and has sales of around $33bn.
Nitriles announces acrylonitrile capacity expansion
INEOS Nitriles today announced plans for a major capacity expansion at its acrylonitrile complex in Green Lake, Texas. This project includes the installation of a fourth reactor train and additional investment in associated equipment at Green Lake. Upon completion and startup in the third quarter of 2008, Green Lake will become the largest acrylonitrile production facility in the world with 544 kt of total capacity or 1.2 billion pounds.
"This investment is a clear demonstration of our commitment to support our customers' growth plans," noted Rob Nevin, CEO of INEOS Nitriles. "It increases the efficiency of capital spend and fixed costs and also leverages our industry scale. We continue to look at cost effective ways of increasing our scale on US and European plants and have further plans to grow the business in line with our customers' requirements."
Oxide: EO and EOA expansion at Lavera
INEOS Oxide announced today, the intention to expand its ethylene oxide and ethanolamine derivative capabilities at its site in Lavera, France.
The expansions will include additional EO capacity and de-bottlenecking of its 55 kt ethanolamine unit to a worldscale, state of the art, 180 kt facility. With the expansion, INEOS Oxide will become the world's leading ethanolamine seller, with an overall nameplate capacity of 360 kt. Production from these facilities will commence early in 2010.
"The expansion of the ethylene oxide and ethanolamine units in Lavera is an important step to continue the growth of INEOS Oxide as the leading ethylene oxide and derivatives producer globally. These investments have been under review since we acquired the Innovene assets at the end of 2005 and will enable us to continue to support the growth of our customers" said Hans Casier, CEO of INEOS Oxide.
INEOS Oxide, part of the Euro 27 billion INEOS Group of Companies, is a leading producer of Ethylene Oxide and Ethylene Oxide Derivatives, Propylene Oxide and Propylene Oxide Derivatives, plus a range of solvents and speciality chemicals, with production facilities in Antwerp Belgium, Koln Germany, Lavera France, Plaquemine Louisiana and Freeport Texas.
INEOS Capital to buy Hydro's polymers business
Capital today announced it has reached agreement to acquire Norsk
Hydro ASA's polymers business for NOK 5.5 billion, (Euro 670
million) subject to closing adjustments.
The acquisition of Hydro's polymers activities, recently renamed Kerling ASA, will allow INEOS to progress its growth strategy in Europe and will enable the company to integrate high quality assets, people and capabilities into its wider business. The acquisition of Kerling represents a very good product and geographic fit, providing complementary assets, expertise and market positions across Europe. INEOS will benefit from an enhanced position across its chloralkali, polymer and compounds businesses, as well as acquiring a 50% share in the Noretyl ethylene cracker at Rafnes, Norway, which is a joint venture with Borealis.
Kerling is a wholly-owned subsidiary of Norsk Hydro ASA, consisting of 1,200 staff and production facilities in Norway, Sweden and the United Kingdom. The business also has interests in joint ventures in Norway, Qatar and China and a shareholding in the Portuguese PVC Producer CIRES, which is listed on Euronext in Lisbon.
"This is an important acquisition for INEOS", said Jim Ratcliffe, INEOS Chief Executive. "Hydro's polymers business has a very good strategic fit with the INEOS portfolio. Its people, assets and technology will provide a significant opportunity for continued growth in this area, " he said.
"Our polymers business has shown a remarkable development and now ranks among the best in the European petrochemicals industry. Together with European industry leader INEOS, we will contribute to creating a new industry champion, well positioned to pursue opportunities for long-term growth. We believe this solution will contribute to a continued strong development of the polymers business," said Hydro President and CEO Eivind Reiten.
Hydro, the Norwegian-based energy and aluminium company, announced on the 6th December 2006 that as part of its strategy to divest non-core assets it was considering a public listing or divestment of the Polymers business. Following this agreement Hydro will discontinue the process of listing Kerling ASA on the Oslo Stock Exchange.
The acquisition is being made by INEOS Capital and stand alone financing for the acquisition has been fully committed by Barclays Capital and Merrill Lynch. The transaction, which is conditional on approval from the EU competition authorities is expected to close in the third quarter 2007.
Ineos Chlorvinyls Announces Sale of its E-PVC Business to Vinnolit
ChlorVinyls has today announced it is to sell its Emulsion PVC
(E-PVC) business to Vinnolit GmbH & Co. KG. The value of the deal is not
The sale consists of the commercial goodwill of the INEOS ChlorVinyls E-PVC business along with its E-PVC production facilities at Hillhouse (UK) and Schkopau (Germany). The deal will also include Vinnolit entering into an offtake agreement for the entire E-PVC output at Porto Torres (Italy).
The E-PVC business has an annual turnover of approximately Euro150 million.
INEOS ChlorVinyls retains its European VCM and Suspension PVC (S-PVC) businesses at Runcorn and Barry in the UK; Wilhelmshaven and Schkopau in Germany; and Porto Marghera, Porto Torres and Ravenna in Italy.
VCM/S-PVC is the largest business of INEOS ChlorVinyls, with the Group's production capacity standing at around 1.1 million tonnes of VCM and 1.4 million tonnes of S-PVC.
S-PVC finds its principal uses in the construction and packaging sectors; whilst VCM is used primarily within the INEOS supply chain.
Chris Tane, CEO INEOS ChlorVinyls comments: "The sale will further strengthen the INEOS ChlorVinyls business by allowing us to consolidate our production and focus on our core strengths in VCM and S-PVC."
It is expected that the sale will be completed once necessary approvals from the European Commission have been obtained.
INEOS Group acquires Borealis AS and secures ownership of Noretyl Cracker at Rafnes.
Group today announced it has reached agreement to acquire the
Borealis AS petrochemical business in Norway for EUR 290 million,
debt free. The deal includes 50% of the Noretyl ethylene cracker
at Rafnes and associated downstream, integrated businesses at the
nearby Bamble polyolefins site.
The acquisition of Borealis AS follows the recent announcement made by INEOS Capital, to buy Norsk Hydro ASA's polymers business (Kerling) and completes the total purchase of the Noretyl cracker, a 50:50 Joint Venture between Norsk Hydro and Borealis AS. The opportunity to purchase both shareholding interests in the Noretyl cracker presents INEOS with unique benefits by bringing the businesses at Rafnes under a single ownership.
The acquisition of Borealis AS provides a complementary fit with its existing Olefins and Polyolefins portfolios, technology and expertise. It also improves integration into key feedstocks allowing the company to optimise across its existing assets in Scotland (Grangemouth), Benelux (Antwerp, Lillo and Geel), Germany (Köln and Wilhelmshaven) and France (Lavéra) giving INEOS an extended geographic reach in European Markets.
"The addition of these facilities to our other recent investments in the region will enhance operational efficiencies and substantially improve our position in the olefins and polyolefins market, enabling us to better serve our customers and progress our strategy in Europe," said Jim Ratcliffe Chairman of INEOS. "This acquisition presents important opportunities for us to support existing assets in the North West European ethylene network. These are well placed assets, complemented by an experienced operations team and high safety, health and environmental standards. Bringing together these two deals is perfectly timed and provides a significant step forward in the development of INEOS."
Borealis AS is a wholly-owned subsidiary of Borealis and INEOS will be acquiring facilities in Rafnes and Bamble, Norway, and staff associated with these operations. The Noretyl ethylene cracker was commissioned in 1977 and expanded by 100,000 t/a in 2005, and currently has a capacity of 557,000 t/a in addition to a propylene capacity of 80,000 t/a. It supplies the nearby Bamble site assets, which include Polypropylene (PP), Low Density Polyethylene (LDPE) and High Density Polyethylene (HDPE) plants.
"The sale of our Norwegian polyolefins business is another step to increase the overall competitiveness of our European operations," comments John Taylor, CEO of Borealis. "We wish all our Norwegian colleagues a successful future with INEOS as their new owners."
The acquisition is being made by INEOS Group Limited and is conditional on receipt of bank consent (with additional financing already committed) and approval from the EU competition authorities. The transaction is expected to close in the third quarter 2007.
29 June 2007 INEOS
INEOS agrees joint venture with LANXESS to operate the ABS plastics business.
Group today announced that it has agreed to set up a Joint Venture with
German chemicals and polymers group, through which it is to take
over the operation of the LANXESS ABS plastics business,
On completion of the first stage INEOS will pay LANXESS Euro35m
for a 51 percent majority share in a new business that is to be
called INEOS ABS.
As part of the agreement INEOS will then acquire the remaining 49 percent share in the new company, two years after the first stage of the deal closes, for a price based on the performance of the business in the two year period.
"The joint venture provides INEOS with strong market positions in a new portfolio of products, that complement our styrenic, polyethylene, polypropylene and PVC plastics activities," said Jim Ratcliffe, Chairman of INEOS. "There is also a good fit with a number of our existing businesses and the JV will benefit from upstream integration into key raw materials."
Lustran Polymers is currently the world's third largest and Europe's leading supplier of ABS plastics, with sales amounting to almost EUR 900 million. On completion of the agreement, assets in Dormagen (Germany); Tarragona (Spain); Map Ta Phut (Thailand); Vadodara (India); Addyston (USA) and around1600 employees are to transfer into the new company.
"The transfer of this business unit to the joint venture, headed by INEOS, is a key milestone in LANXESS's realignment and offers both the Lustran Polymers business and its employees the best opportunities for further development," said Chairman of the Board of LANXESS, Axel C. Heitmann.
The acquisition is being made by INEOS Group Limited and is conditional on approval from the relevant antitrust authorities. The transaction is expected to close at the end of September 2007.
Southern Daily Echo 2007/6/27
who made £3.3bn
HE'S the tenth richest man in the country and now his Hampshire firm has been ranked as Britain's biggest private business.
New Forest-based engineer turned successful entrepreneur Jim Ratcliffe founded a chemicals company nine years ago that today has sales of £18 BILLION.
Based in Lyndhurst, his firm Ineos has triple the sales of high street favourite John Lewis, which is number two on the list of the UK's biggest privately owned companies.
From the credit card in your wallet to the air conditioning in your car, the chlorine in the water to the plastic packaging around your food, Ineos' products are everywhere.
Overall, the company Mr Ratcliffe started under a decade ago is now the 15th largest business by sales in the UK, with profits of £630m. As Ineos' principal shareholder the married 54-year-old, who lives in Hampshire, has seen his personal fortune balloon from £1.1 billion last year to an estimated £3.3 billion.
The Lyndhurst headquarters is the smallest of all Ineos' offices, employing just 150 of the firm's global 16,500-strong workforce, which is spread across 73 sites in 18 countries.
The nearest plants are in north-west England and Scotland, with the majority in Europe and America and more planned in Asia, including China. They produce more than 50 million tonnes of chemicals a year.
An Ineos spokesman said: "Typically you will find that Ineos' products are things that we take for granted in every day life.
"It's a very interesting and exciting company to work for. People might not have heard of the company but they will be familiar with our heritage. We have bought companies from BP, ICI and BASF and they have been invested in and grown over a period of time and they are doing well in the Ineos group.
He said the company was started in Hampshire and plays a part in the community.
"We hope our presence continues to benefit local people in terms of employment, support for local businesses and community projects.
"We are committed to being a good neighbour and are very aware of the responsibility we have to our surroundings. As part of our long-term commitment to Lyndhurst, we work within the community through effective consultation and communication.
"Since moving to the area, Ineos has spent more than £150,000 in support of a number of local charities and sporting organisations."
INEOS Polyolefins announce PP restructuring at Sarralbe
Having already announced investment projects of more than Euro150M over the next three years, notably in high density polyethylene (HDPE) at Lillo and polypropylene (PP) at Geel, INEOS Polyolefins announced today its intention to further restructure its assets to ensure a robust production platform capable of maintaining its leading market position for the long-term.
Consistent with this strategy, INEOS Polyolefins intend to exit PP production on two of their three PP lines at Sarralbe in France. The two slurry lines have become unsustainable due to feedstock issues and their exposure to grades/markets unable to provide sufficient returns through the cycle.
PP production on Line 2 (165ktpa) is expected to cease by the end of 2008, after having transitioned key customers to our plants in Lavera, France (debottlenecked by 10ktpa in Q4 2006 to 300ktpa) and Grangemouth, Scotland (currently being debottlenecked by 50ktpa to 285ktpa).
PP production on Line 1 (50ktpa) is expected to cease by the end of 2009, after having transitioned key customers to our plant at Geel, where copolymer capacity will be increased by 220ktpa to 500ktpa during 2009.
The third PP line (65ktpa) and all HDPE lines (200ktpa) at Sarralbe remain strategic to the Business, with unique technology enabling a strong portfolio of differentiated products.
“INEOS Polyolefins continues to focus on growing a strong and sustainable business. On completing this restructuring, Sarralbe will be reinforced as a site fully dedicated to manufacturing differentiated PP and HDPE products where we have a long term competitive advantage” said Bill Reid CEO of INEOS Polyolefins.
|Sarralbe in France （千トン）|
INEOS to discontinue Wilhelmshaven cracker project エチレン80万トン計画
has reluctantly decided that it will suspend all further work on
the planned investment in a new ethane cracker at the
Germany, following recent discussions between Statoil, E.ON
Ruhrgas and INEOS on this investment project.
Increasing capital costs of well over 30% in the last twelve months alone have made the project, in its current form, economically unviable.
INEOS recognises the support given by the City of Wilhelmshaven, the Government of Lower Saxony and the Federal Government to the Wilhelmshaven expansion plan, and the Company remains committed to investing in its operations in the region, but this cannot be achieved at any cost. The decision that has been made recognises the significant impact of higher capital costs on the viability of this particular project.
Using ethane from a gas separation unit to be constructed by Statoil and E.ON Ruhrgas in Dornum, INEOS had planned to expand its operations at the site through investments in a new ethane steam cracker, with accompanying investments in a new membrane chlorine cellroom along with major uprates to its existing VCM and SPVC plants. In addition, it was to construct an ethylene pipeline from Wilhelmshaven to the ARG pipeline in North Rhine-Westphalia.
"This is clearly a disappointing outcome for INEOS, the City of Wilhelmshaven and the State of Lower Saxony," said INEOS Chairman Jim Ratcliffe."All parties have invested considerable resources developing their projects since the original agreement between the three companies was made in August 2005. It is unfortunate that the recent increase in project related material and labour costs has had such a significant impact on the project economics that it became unsustainable."
INEOS remains committed to the growth of all of its core businesses and to expansion in Germany.
UK company Ineos with expansion plans in Wilhelmshaven
On 24 May 2005 in Hanover, the
CEO of UK chemical company Ineos, Jim Ratcliffe, presented his
planned investment in Wilhelmshaven to Lower Saxony’s Minister President Christian Wulff
and Minister for Economic Affairs Walter Hirche. At the same time
he announced the start of a pre-engineering study for the project
involving between 15 to 20 million euros.
ChemCoast welcomes the company’s development plans for the chemical location Wilhelmshaven, describing the move as the “stimulus of the century” for the entire North German chemical region.
Lower Saxony State Chancellery
Ineos plans project study to expand the Wilhelmshaven location / Wulff and Hirche comment, “Great prospects for Lower Saxony“
HANOVER. Today, Jim Ratcliffe, CEO of the British chemical company Ineos, presented his company's planned investment in Wilhelmshaven to the Lower Saxon State Government in Hanover. The international company plans to expand its Wilhelmshaven chemical location and invest up to one billion euros. Ineos detailed the company’s plans to perform a pre-engineering study costing between 15 and 20 million euros to Minister President Christian Wulff and Minister for Economic Affairs Walter Hirche. “This offers outstanding prospects for Lower Saxony’s economy and is a major step towards implementing the plan,” stated Wulff and Hirche.
At today’s meeting in the State Government’s Guesthouse Jim Ratcliffe acknowledged the state’s commitment to the development plans in Wilhelmshaven. The joint statement by the state of Lower Saxony and the German Federal Government concerning financial support for the plan has brought the project a good step forward. Minister President Wulff sent this statement to Ineos head Ratcliffe at the start of May. The company will start preliminary work on the project within a short time. The results of the detailed pre-engineering study are expected in around six months. If the study produces the desired results, construction will begin immediately thereafter.
Ineos’ plans include the building of a new chlorine electrolysis plant and an ethane cracker, expansion of its PVC production facilities and the construction of a 275 kilometre long ethylene pipeline from Wilhelmshaven to Marl in the German state of North Rhine Westphalia. This investment will secure around 360 existing jobs and create a further 300 direct jobs. Hirche stated, "We also reckon with considerable indirect employment effects.” The project is also expected to trigger other knock-on investments, from energy suppliers, for instance. These could be as high as half a billion euros.
Minister President Wulff and Minister for Economic Affairs Hirche stressed the project’s enormous significance for the northwest region of Lower Saxony and the long-term security and expansion of North Germany as a chemical location. “The start of the pre-engineering study is a good signal for our state. The overall project would be one of the world’s largest commitments by a chemical company,” said Wulff. The state government has established a working team to ensure that the project is supported and coordinated without any unnecessary delays.
Ineos, an international producer of specialty chemicals employs 9,000 people and generated total sales of around 6 billion euros in 2004. Jim Dawson from Ineos Capital and the managers of the Wilhelmshaven Ineos companies, Carl Vercauteren and Hans-Peter Kramer, accompanied Ineos CEO Ratcliffe to Hanover.
June 2, 2005
Ineos’ plan for an 800,000-metric-ton facility in Wilhelmsha
INEOS site at Wilhelmshaven is operated by INEOS ChlorVinyls and produces chlorine and caustic soda, along with S-PCV and VCM for use in the PVC chain. Investment in a biodiesel facility at the site would present INEOS Enterprises with excellent logistics opportunities to supply the German fuels market.
Ineos, however, has not cancelled previously announced plans to build an ethylene plant at Wilhelmshaven, Germany, following the Innovene deal. “Buying Innovene does not change the supply-demand balance for ethylene in Europe,” MacLean says. “The Wilhelmshaven project is still alive, and we intend for it to go ahead.” Ineos will make a final decision on the project at the end of this year, he says.
Ineos said on the deal would not alter the ethylene balance in Europe and the 700,000 tonnes net short meant that the company would continue with its plans to build an ethylene complex at Wilhelmshaven in Germany.
Ineos folds silicas business into Carlyle Group's PQ Corporation
Ineos announced Thursday
that it would merge its Ineos Silicas business with Carlyle Group's PQ
The Carlyle Group would hold 60% share and Ineos approximately 40% of the new company. Financial terms were not immediately disclosed.
The combined business would become a global producer of speciality inorganic chemicals, catalysts, and engineered glass products with annual sales revenue estimated at $1 billion, Andy Currie, Director of Ineos Capital, who will serve as a Director on the Board of the new company, said,
PQ Corporation, was bought by the Carlyle Group on On June 1 2007. The deal completed in July.
PQ Corporation develops, manufactures and sells silicate-based speciality chemicals, catalytic Zeolites and Zeolite-based catalysts as well as engineered glass spheres.
Business consists of three product and technology platforms based on silicate chemistry, zeolite chemistry and magnesium derivative chemistry.
Potters Industries, PQ Corporation's wholly owned subsidiary, is a leading producer of engineered glass materials serving the highway safety, polymer additive, metal finishing, and conductive particle markets.
PQ Corporation is a leading producer of silicate, zeolite, and other performance materials serving the detergent, pulp and paper, chemical, petroleum, catalyst, water treatment, construction, and beverage markets. It is a global enterprise, operating in 19 countries on five continents, and along with its chemical businesses, includes Potters Industries, a wholly owned subsidiary, which is a leading producer of engineered glass materials serving the highway safety, polymer additive, metal finishing, and conductive particle markets.
PQ Corporation was founded in 1831 and was known as the Philadelphia Quartz Company from 1864 until 1978. The values of our founders - integrity and fairness, diligence and service, learning and imagination - are still reflected in our contemporary corporate culture. We believe that this culture and the strong spirit of teamwork it fosters are of immense benefit to our customers, our employees, and our suppliers alike.
On June 1, 2007, CCMP Capital Advisors, LLC, on behalf of J.P. Morgan Partners, LLC, has reached an agreement for The Carlyle Group to acquire Niagara Holdings, Inc., parent company of PQ Corporation.
The transaction value is approximately $1.5 billion.
2007/10/12 The Carlyle Group
The Carlyle Group And INEOS Agree To Combine PQ Corporation And INEOS Silicas
Global private equity firm The Carlyle Group announced recently that PQ Corporation, the specialty chemical company it acquired in July of 2007, has agreed to combine with INEOS Silicas, a division of INEOS, the global manufacturer of petrochemicals, specialty chemicals and oil products. PQ Corporation and INEOS Silicas will combine to form a global producer of specialty inorganic chemicals, catalysts and engineered glass products with annual sales revenues in excess of US$1 billion. Carlyle will own an approximate 60% share of the new combined company, while INEOS will hold approximately 40%. Terms of the transaction were not disclosed.
Andrew Marino, Principal of The Carlyle Group, said, "This transaction represents the combination of two successful and complementary companies to create a business with increased capabilities and market coverage to better serve our customers in the inorganic specialty chemicals space. We look forward to working closely with our new partners at INEOS to maximize the growth opportunities of the new company.・
Andy Currie, Director of INEOS Capital, who will serve as a Director on the Board of the new company, said, "This is a well-timed next step in the development of INEOS Silicas. Operating under single ownership presents both businesses and their customers with new opportunities. PQ brings with it unique benefits in terms of its people and its technology, incorporating some of the world's leading product and process innovation.・
The combined company will be called PQ Corporation. Mike Boyce, Chairman and Chief Executive Officer of PQ, will serve in that same capacity following the close of the transaction. "Our strategy at PQ has and will continue to be profitable growth of our business,・Boyce said. “A combination with INEOS Silicas offers an immediate way to achieve an enhanced global presence, which will result in a greater ability to meet and exceed our customers・expectations. Additionally, the size and growth profile of this new company will allow for better access to capital for future investments in growth opportunities.
2008/1/11 Ineos BP
INEOS to buy Vinyl Acetate Monomer and Ethyl Acetate businesses from BP
INEOS today announced it has reached an agreement to acquire the Vinyl Acetate Monomer (VAM) and Ethyl Acetate (EtAc) businesses from BP. The deal comprises 500ktpa of production capacity at the Saltend manufacturing site near Hull, UK, along with the Teesside to Saltend Ethylene Pipeline (TSEP).
The acquisition of BP’s Acetate businesses provides a complementary fit with the portfolio, technologies and expertise of INEOS. It also allows the company to optimise existing links between the Hull and Grangemouth sites.
“The addition of these facilities broadens the INEOS portfolio of oxygenated solvents, optimises existing links with our Grangemouth site and helps us to meet the growing demand for both products," said Jim Ratcliffe, INEOS Chairman. “These are well placed assets, complemented by a very experienced operations team and high safety, health and environmental standards. Acquiring these two businesses provides another step forward in the development of INEOS Enterprises and INEOS Oxide in Europe”.
The Ethyl Acetate plant was commissioned in 2001 and has a capacity of 250ktpa, making it one of the world’s largest single Ethyl Acetate facilities. Ethyl Acetate is used in the manufacture of printing inks, glues, paints, packaging, cosmetics and pharmaceuticals. The Vinyl Acetate Monomer plant, which also has 250ktpa capacity, was commissioned in 2002 and supplies an essential raw material for paints, adhesives, floor coverings and clothing production. Between them, the facilities employ around 40 people, who it is expected will transfer to INEOS on completion of the acquisition. The combined sales revenue in 2007 was around $400m.
Upon completion, products from the newly acquired businesses will be integrated into the portfolios of INEOS Oxide and INEOS Enterprises. Ethyl Acetate will become part of the INEOS Oxide solvent portfolio and will be supplied through existing channels to market alongside butyl acetate, glycol ethers and glycol acetates. Vinyl Acetate Monomer will add a new product line to the INEOS Enterprises business and will reinforce its strategy of growth through acquisition of businesses with good manufacturing facilities combined with sufficient size and scale for growth. It is expected that INEOS Enterprises will assume overall responsibility for operating both facilities.
“We are pleased to have reached this agreement with INEOS. The sale of our Acetate businesses concludes an important part of our strategy to re-focus BP’s operations at the Saltend site,” comments Dave Smith, General Manager of BP European Acetyls. “In line with the strategy that we announced in 2007, the sale will allow us to focus on our commitment to supply Acetic Acid and Acetic Anhydride to customers around the world. During the transition, BP and INEOS are committed to a high level of business continuity.”
The acquisition is being made by INEOS Group and is conditional on approval from the EU competition authorities. The transaction is expected to close in the first quarter 2008.
March 13 2007 BP
BP to Sell Two Chemicals Businesses Based at Hull
BP announced today its intention to sell its ethyl acetate (ETAC) and vinyl acetate monomer (VAM) manufacturing units at Saltend, near Hull, UK, and the associated commercial businesses.
The decision follows a review which concluded that the Saltend site would focus on its existing acetic acid and acetic anhydride 無水酢酸businesses. In addition, BP is proposing to relocate all commercial roles in the European region of its acetyls business from its offices in Sunbury-on-Thames, Middlesex to the Saltend site. The proposed move is expected to create more than 30 commercial roles at the Saltend Site which is the largest producer of acetic acid in Europe.
Guy Moeyens, the Business Unit Leader of BP Acetyls said “We are committed to supplying acetic acid to customers around the world. We will continue to develop world class technology in acetic acid and acetic anhydride using our research and manufacturing facilities at Saltend. We will ensure that our staff, customers, suppliers and contractors are kept informed of developments”
Notes for editors:
- Vinyl acetate monomer (VAM) is used in paints, adhesives, floor coverings and clothing. Ethyl acetate (ETAC) is used in printing inks, glues, paints, packaging, cosmetics and pharmaceuticals.
- BP Saltend produces about 600,000 tonnes of acetic acid per year, the largest manufacturer in Europe; and about 150,000 tonnes of acetic anhydride per year. Acetic acid is used in VAM, PTA esters and other intermediates and acetic anhydride is used in cellulose acetate and chemical derivatives.
- ETAC and VAM are manufactured from acetic acid and ethylene using technology developed by BP’s research laboratories at Saltend.
- Globally, BP and its joint ventures produce around 2,900,000 tonnes of acetic acid, 150,000 tonnes or acetic anhydride, 400,000 tonnes of VAM; and 300,000 tonnes of ETAC.
- Around 400 people are employed on the manufacturing site at Saltend with a further 185 employed in the research and technology centre.
BP Starts Commercial Production From World's Largest Ethyl Acetate Plant
BP has started full-scale commercial production from its new Avada ethyl acetate production unit at its site at Saltend, Hull, UK. The 220,000 tonnes a year capacity unit is the world's largest single ethyl acetate production unit.
The plant is the first to use BP's proprietary Avada technology which produces ethyl acetate directly from ethylene and acetic acid. Ethylene is supplied to the plant through the recent extension of the UK ethylene pipeline system, linking Hull to BP's Grangemouth complex, and acetic acid is supplied from three plants on the Saltend site itself.
European Commission Gives Clearance for INEOS acquisition of Hydro Polymers
INEOS Capital confirms that it has today received unconditional clearance from the European Commission for the purchase of the Hydro Polymers businesses in Norway, Sweden and the UK from Norsk Hydro ASA. The acquisition was agreed with Norsk Hydro last year and includes the remaining 50% interest in the Noretyl ethylene cracker at Rafnes, INEOS Group having acquired the other 50% from Borealis last summer.
INEOS expects the acquisition to be completed in the next week.
Comments Jim Ratcliffe, INEOS Chairman: "We are delighted that we are now able to proceed towards completion of the deal, which is a significant step forward for the growth and development of INEOS."
On 12th December the Commission began an investigation into the alleged early implementation of this transaction (which would be contrary to the applicable competition laws) by visiting the parties' premises in the UK. The Commission has now confirmed that, following its assessment of the information gathered during the inspections, it has come to the conclusion that the allegations of early implementation were unjustified and it will not therefore be taking the matter any further.
Comments Chris Tane, CEO INEOS ChlorVinyls: "We were confident that we had fully complied with the relevant laws, and we are pleased that the Commission has confirmed that it has completed its investigation and will not be taking any further action."
INEOS Polyolefins announces extension of Grangemouth PP and PE
INEOS Polyolefins today announced its intention to invest in random co-polymer technology on its liquid pool polypropelene (PP) unit at Grangemouth, Scotland. By linking ethylene supply from its crackers to the PP unit, random co-polymer grades with a wide range of melt flow rates will be produced commencing Q3 2008 for the blow moulding, packaging and medical sectors.
In early 2007, INEOS Polyolefins announced the 50ktpa debottleneck of its liquid pool polypropylene unit, raising its capacity to 285ktpa. This investment has now been completed and has enabled the company to implement a further step-change in the asset's capability,
As part of its development of the polyolefin platform at Grangemouth, INEOS Polyolefins also intends to introduce swing capability on its 310 ktpa LLDPE plant to produce HDPE grades. This follows the recent development by INEOS Polyolefins of rotomoulding grades at Grangemouth and the appointment of ICO Polymers as its exclusive partner to distribute its range of advanced hexene co-monomer rotomoulding polymers. The new HDPE injection moulding grades will be produced in addition to the exisiting LLDPE/MDPE grades and will complement the existing HDPE product range.
"INEOS Polyolefins is strongly committed for the long-term to serving the polyolefins market with high quality, cost-effective and innovative products. With these investments we continue to create a robust production platform throughout Europe that will allow us to maintain our leading market position and ensure the future growth of our business" concludes Bill Reid, CEO of INEOS Polyolefins.
INEOS to acquire Seal Sands site (UK) from BASF
today announced that it has agreed to purchase the Seal Sands
site on Teesside (UK) from BASF plc, a subsidiary of the German
chemical company BASF. The acquisition is being made by INEOS
Nitriles Limited and is conditional on approval from the relevant
antitrust authority. The value of the deal is not disclosed.
The Seal Sands site provides large-scale production facilities for acrylonitrile (AN), adipodinitrile (ADN) and hexamethylenediamine (HMD), along with by-product plants. These chemical intermediates are used in the production of acrylic and polyamide (PA) fibres for clothing and carpets, as well as for acrylonitrile-butadiene-styrene (ABS) and PA plastics for the automotive, electric & electronics and domestic appliance industries.
The Acrylonitrile plant at Seal Sands currently produces around 230,000 tonnes per annum with the majority of product being used to supply three BASF downstream businesses, located at Antwerp (Belgium), Seal Sands (UK) and Ludwigshafen (Germany).
The acquisition fits well with INEOS Nitriles capabilities and expertise in the Acrylonitrile and associated businesses. Additionally, the Seal Sands Acrylonitrile plant will serve the existing INEOS Acetonitrile plant located at the Seal Sands facility, which currently upgrades and sells the by-product received from the plant.
Said Rob Nevin, INEOS Nitriles CEO: “The purchase of BASF’s Seal Sands manufacturing site is a natural development for INEOS Nitriles and supports our long-term strategy. We have a strong commitment to our customers and this acquisition will support their plans for growth.”
“The sale of the Seal Sands site is part of our approach to focus on the core assets of our polyamide value chain,” said Dr. Harald Lauke, President of BASF Performance Polymers division.
“I am confident that the integration of this site and its workforce into INEOS Nitriles, a company committed to a long-term participation in the acrylonitrile business, will be the best guarantee of continued future success for the Seal Sands site,” said Bernd Brian, BASF Site Director at the Seal Sands site.
BASF plc has around 240 employees at the site. On completion these employees will transfer their employment to INEOS Nitriles. INEOS Nitriles will also take over all existing supply and service arrangements.
INEOS Technologies signs further agreement with Sibur LLC
Sibur LLC has selected INEOS' Innovene PP Process for a new 200,000 tpa polypropylene plant to be constructed at the production site of Tomskneftekhim LLC, Tomsk, Russian Federation.
The Tomsk plant will be the nineteenth to use the Innovene PP process. It will produce a full range of homopolymer, random and impact copolymers and is expected to commence production in 2012.
The Innovene PP process is licensed by INEOS Technologies, which is the specialist technologies development and licensing division of INEOS Group.
Sibur previously licensed a 500,000 tpa plant based on Innovene PP technology at its industrial complex in Tobolsk, Tyumen Region, Russian Federation.
“We are very pleased that we have extended our licensing partnership with Sibur,” said Mark Niederschulte, Vice President - Commercial of INEOS Technologies. “The Innovene PP Process has proven to be the preferred technology for new PP plants due to its low operating and capital costs, broad product capability and operational reliability. In addition to its demonstrated commercial success, the Innovene PP process affords significant advantages for future expansions.”
INEOS Technologies provides Sibur with a complete and flexible technology that will help it to secure a long-term competitive position.
INEOS Technologies is one of the companies in the INEOS family. INEOS is the world's third largest chemicals company; a leading manufacturer of petrochemicals, specialty chemicals and oil products. Comprising 19 businesses, with a production network spanning 76 manufacturing facilities in 20 countries, the Company produces more than 32 million tonnes of petrochemicals and 20 million tonnes per annum of crude oil refined products (fuels). INEOS employs 16,600 people and has sales approaching $45billion.
INEOS Technologies is a leading developer and licensor of technologies for the global petrochemical industry. We offer the broadest range of petrochemical technologies on the market today, and also supply the catalysts, additives, and coatings that our customers require to obtain the best possible performance from their investments.
INEOS Technologies’ complete portfolio of leading licensed technologies includes:
・ Innovene PP gas phase technology for the production of polypropylene
・ Innovene S slurry technology for the production of mono- and bi-modal HDPE
・ Innovene G swing gas phase technology for the production of LLDPE and HDPE
・ Polystyrene general purpose, high impact and expandable PS technologies
・ BICHLOR membrane electrolyser technology for chlor alkali production
・ Vinyls technology for the production of EDC, VCM and PVC
・ Nitriles technology for the production of acrylonitrile and maleic anhydride
FTC Challenges Carlyle
Partners’ Purchase of INEOS’s Sodium Silicate Businesses
Companies Required to Sell Carlyle’s Sodium Silicate Plant in Utica, Illinois
The Federal Trade Commission today issued a complaint charging that Carlyle Partners IV, L.P.’s (Carlyle) proposed acquisition of the world-wide sodium silicateケイ酸ナトリウム and silicas business of INEOS Group Limited (INEOS) would be anticompetitive and in violation of the antitrust laws. Carlyle owns PQ Corporation (PQ), and the transaction as proposed would therefore combine PQ ? the largest sodium silicate producer and seller in the highly concentrated Midwest region of the United States ? with INEOS, its third-largest competitor.
2007年10月11日、Ineos はIneos Silicas をCarlyle Group の PQ Corporation に統合すると発表した。
Carlyle Group が 新会社の 60%、Ineos が 40% を所有する。
PQ Corporation は旧称 Philadelphia Quartz で、silicate ベースのspeciality chemicals、Zeolite 触媒、マグネシウム誘導品を事業とし、100%子会社のPotters Industries で engineered glass materialss 事業を行っている。
2007年6月にCarlyle Group が15億ドルで買収した。
To remedy the alleged
anticompetitive effects of the transaction, the companies have
entered into a consent agreement with the Commission that
requires them to sell PQ’s sodium silicate plant and
businesses in Utica, Illinois, to an FTC-approved buyer. The order also requires the
companies to license all of the intellectual
property related to sodium silicate product at the Utica plant.
“The consent agreement underscores that even when the to-be-acquired firm is relatively small, the Commission has concerns when the market is highly concentrated and characterized by an absence of strong competition,” said Jeffrey Schmidt, Director of the FTC’s Bureau of Competition.
The Relevant Product Market
Both PQ and INEOS participate in the sodium silicate market world-wide, and PQ is the largest sodium silicate producer in the United States. Sodium silicate has a variety of direct uses and also is used in the production of downstream silicate derivatives, also known as silicas. It is typically sold in an aqueous solution that is 65 percent water; sodium silicate markets exhibit strong regional characteristics because of high transportation costs relative to the value of the product. Because there are no close chemical substitutes for sodium silicate, the FTC contends that other products do not constrain its pricing.
The Commission’s Complaint
According to the Commission’s complaint, the proposed acquisition would be anticompetitive and violate Section 5 of the FTC Act and Section 7 of the Clayton Act as amended, in that it would combine the largest firm in the Midwest U.S. sodium silicate market, PQ, with the third-largest firm in that market, INEOS. Currently PQ has 50 percent of the market and INEOS has 12 percent of the market. The FTC contends that in addition to reducing direct competition between the two companies, the proposed acquisition could lead to coordination among competing firms in the sodium silicate market.
The Midwest market for sodium silicate already is conducive to such coordination due to several structural features, including the facts that sodium silicate is a homogenous product, pricing information is readily available, and competitors recognize that the market is essentially a duopoly in which the top two firms, PQ and Occidental, operate interdependently. Based on concentration levels and competitive concerns, the complaint states that the acquisition could make coordinated interaction between the competing firms more likely, leading to higher prices for sodium silicate. Finally, the complaint alleges that entry into the relevant market would not be timely, likely, or sufficient to deter the acquisition’s anticompetitive impacts.
Terms of the Consent Order
The Commission’s consent order is designed to remedy the alleged anticompetitive effects of the acquisition. The order requires Carlyle to divest PQ’s sodium silicate plant in Utica, Illinois, to Oak Hill Acquisition Company, LLC (Oak Hill), or another FTC-approved buyer if Oak Hill is later found to be an unacceptable acquirer, within five days of acquiring INEOS. Oak Hill is a new firm created for the purpose of acquiring the Utica plant. However, its principal owner has been involved in many industrial investments over the past 25 years in the chemical, software, telecom, construction, real estate, and energy areas.
The consent order contains several other terms to ensure that the sale of the Utica plant to Oak Hill is successful and that competition continues within the market. For example, in addition to allowing the Commission to require Carlyle to find another buyer if Oak Hill is found to be unacceptable, it requires Carlyle and INEOS to make available to any buyer the necessary personnel, assistance, and training to enable it to successfully operate the Utica plant for two years after its sale.
In addition, the companies must enter into an employee services agreement covering certain union employees at the Utica plant to ensure that they can keep their jobs after the sale. Next, the order allows the FTC to appoint an interim monitor to ensure that the companies comply with their obligations following the divestiture, as well as a divestiture trustee if PQ fails to comply fully with the terms of the order. Finally, the order requires the companies to notify the FTC of any change in their corporate structures that may affect compliance with its terms. The order will expire in 10 years.
The Commission vote to accept the complaint and proposed consent order was 4-0. The FTC will publish an announcement regarding the agreement in the Federal Register shortly.
The agreement will be subject to public comment for 30 days, beginning today and continuing through July 29, 2008, after which the Commission will decide whether to make it final. Comments should be addressed to the FTC, Office of the Secretary, Room H-135, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC is requesting that any comment filed in paper form near the end of the public comment period be sent by courier or overnight service, if possible, because U.S. postal mail in the Washington area and at the Commission is subject to delay due to heightened security precautions. Comments also can be filed electronically using the Commission’s Web site.
Ineos mulls future of PVC
production in Italy
Modernisation plan in trouble at Porto Marghera
Chemicals giant Ineos could quit production of PVC and vinyl chloride monomer (VCM) at Porto Marghera, just outside Venice, if it fails to resolve a long-running problem over supply of chlorine to the site.
Closure could put at risk between 800 and 1,300 jobs there and at associated operations in Ravenna and in Assemini in Sardinia.
Local media are taking the closure as a “fait accompli,” with one newspaper going so far as to say that an announcement had already been made that Ineos would leave Porto Marghera. However, Ineos told PRW.com that no such announcement has been made.
Italian subsidiary Ineos Vinyls Italia said it has been working for the past four years on a modernisation plan for the Porto Marghera site, where PVC production capacity is around 200,000tpa.
In a statement earlier this year, the company said it had invested ?60m in the site since 2000. It also said that it wanted to balance production of VCM and PVC, in a plan that would, among other things, raise PVC capacity to 260,000tpa.
The plan hinges on the acquisition of a chlor-alkali plant, currently owned by Syndial, a subsidary of the Italian Eni group. This plant produces the chlorine necessary for production of VCM and PVC.
However, last month Ineos said that it has become clear that the acquisition cannot take place because of problems that remain confidential.
The Syndial plant uses old mercury cell technology, and discussions about converting it to more environment-friendly membrane cell technology have been going on for years.
Ineos said it is, “strongly convinced of the validity of the industrial project, and aware of its criticality for the entire Italian chemical business”.
It added that it is evaluating various possible solutions to the problem. A conclusion could be reached at a board meeting this Friday, according to a local media report.
Ineos heading back into
Berlusconi associate said to be ready to make an offer.
Troubled PVC producer Ineos Vinyls Italia could be the subject of an offer from a group of Italian entrepreneurs headed by a close associate of prime minister Silvio Berlusconi.
According to investor newspaper Milano Finanza (MF) this morning, Ennio Doris, the president of on-line bank Mediolanum, has already written a letter of intent concerning a possible acquisition. However, no formal offer has yet been made.
Ineos produces PVC and vinyl chloride monomer (VCM) at Porto Marghera, near Venice.
Mediolanum is partly owned by Fininvest, which is run by the Berlusconi family. The Italian prime minister currently plays no active part in its management.
Doris and his colleagues, based in the Venice region, are one of two groups to have written letters of intent, according to MF. The identity of the second group is unknown.
Contacted by PRW.com Ineos Vinyls Italia communications manager Manuela Pellizzon said the company did not comment on articles in the press.
Doris is no stranger to the chemicals business. His family recently took a stake in Caffaro Bifuel, part of speciality chemicals company Snia.
MF notes that various theories have been put forward in recent months about possible buyers for Ineos Vinyls Italia, which is owned by UK-based Ineos, the world's third largest chemical company.
One name that has cropped up is gas and chemicals giant Eni which, via its Enichem subsidiary, was the original owner of the Porto Marghera operation.
Rumours have been rife in the Italian media for several months about a possible pull-out from Italy by Ineos. Plans by the company to rationalise its Porto Marghera operations have been scuppered by bureaucratic delays, financial problems and political in-fighting.
September 16 2008 dofonline.co.uk
BOC and Ineos merger refused
Competition Commission would stifle healthy competition in chlorine industry.
The Competition Commission (CC) has provisionally concluded that the anticipated acquisition by BOC Limited (BOC) of the chlorine packaging and distribution business of Ineos Chlor Limited (Ineos) could damage competition in the markets for the distribution of packaged chlorine in cylinders and in drums in the UK.
The principal use of
packaged chlorine is by the UK water industry for water
Diana Guy, Inquiry Group Chairman commented said, "we found that the proposed merger would reduce the number of competing distributors and would end the rivalry between BOC and Ineos Chlor, which are currently each other's closest competitors in these markets. We did not think that entry by new companies, expansion of other players in the market, imports or any buyer power held by BOC or Ineos Chlor's customers would be sufficient to prevent BOC increasing prices and/or reducing service levels following the merger."
The Commission noted the imminent exit from the chlorine packaging market of Albion Chemicals Ltd between 2009 and late 2012, this exit was regardless of the merger between BOC and Ineos taking place.
With the exit of Albion the CC decided that BOC and Ineos would be, "likely to increase the price for wholesale packaged chlorine above current levels.
March 25. 2008: BOC,
BOC announces acquisition of INEOS ChlorVinyls’ packed chlorine business
BOC, a member of the Linde Group, a leading supplier of industrial gases and packaged chemicals, announced today that it has agreed to purchase Runcorn-based INEOS ChlorVinyls’ packed chlorine business. The sale will be completed once necessary approvals from the Office of Fair Trading have been obtained. The value of the sale has not been disclosed.
The packed chlorine business is a specialist niche market which involves the packaging and delivery of chlorine liquefied gas in drums and cylinders. The main applications are water disinfection and chemical intermediate treatments. INEOS ChlorVinyls’ staff associated with the business will transfer to BOC as BOC will continue to fill cylinders at the INEOS site at Runcorn.
Germany's Vinnolit ends PVC offtake agreement with Ineos in Italy
German polyvinyl chloride
producer Vinnolit has ended an off-take agreement with Ineos
ChlorVinyls to distribute material from its Porto Torres plant in
A spokesman for Vinnolit said Wednesday that the agreement, which had been in place for one year, "was terminated by mutual agreement as it was not working in a profitable way for both parties."
The agreement was initially expected to renew after one year but it was understood that the period between July and end September 2008 had been spent seeking an exit strategy suitable for both companies.
The Vinnolit spokesman confirmed that there was a financial element to the termination of the agreement but declined to offer any further details.
The termination was effective as of October, the source added.
Ineos was approached for comment but had not responded at time of press.
Vinnolit entered into the agreement, which was for the entire PVC output of the 65,000 mt/year Porto Torres plant in June 2007 when it acquired the paste PVC business of Ineos ChlorVinyls. This acquisition included paste PVC production facilities at Hillhouse, UK and Schkopau, Germany.
Customers of the site had been notified of Vinnolit's decision by letter during the last two weeks, market sources said.
Meanwhile, Ineos ChlorVinyls' future as a vinyls producer in Italy remains unclear with its desire to exit resin production at Porto Marghera a talking point in the market for some time.
Plans to modernize the site to balance VCM and PVC production by increasing resin output to 260,000 mt/year had not been realized and the chlorine supply which comes via Eni subsidiary Syndial has also caused problems.
Ineos had previously sought to purchase the Syndial facility making the site fully integrated but market sources said that the deal had run into problems and now looked unlikely. The Syndial plant uses mercury technology which is increasingly unpopular due to its environmental impact.
Other chlor-alkali makers have been making the switch from mercury to membrane technology in recent years.
A decision on Porto Marghera had been expected in July. This was postponed to the end of September but still no news had emerged.
Ineos produces 200,000 mt/year of PVC at Porto Marghera and 205,000 mt/year at Ravenna.
Timing unclear for potential sale of Ineos Vinyls Italia
The timing for a
potential sale of polyvinyl chloride producer Ineos Vinyls Italia
is uncertain, although the government's appetite for a deal to
forge ahead is strong, a spokesman for the company said
"We cannot say when a deal will go through," the source said.
But he added that the bid by a consortium led by Italian businessman Fiorenzo Sator enjoys a key difference from Ineos' previous efforts to end the long-running debate over its future in Italy--that is, a climate of "government commitment" to finding a solution.
It is understood that the Italian government is concerned by the potential impact of the loss of chlor-alkali and vinyls production to the country's industry.
Years of debate centering on the Porto Marghera site culminated this summer in a series of meetings at which Ineos was expected to announce its intentions. But after each gathering, a decision was postponed, with sources close to the discussions saying that the issues were so complex and the number of stakeholders so great that a decision was still out of reach.
Then, earlier this week Italian media reported that Sator had signed a preliminary agreement to purchase the PVC and vinyl chloride monomer assets of Ineos Vinyls Italia for Eur120 million ($163.94 million).
The news came as a surprise to a number of market watchers, who saw unresolved problems as a stumbling block to any fresh deal. At the heart of these problems is a long-running disagreement over chlorine supply at Porto Marghera.
For a number of years, Ineos has been seeking a purchase agreement with Syndial--a division of Eni--which produces feedstock chlorine at the site.
Ineos' aim was to backward integrate its vinyls production to make the process more efficient. But, talks did not reach any conclusion.
The 200,000 mt/year Syndial chlor-alkali plant uses mercury technology that is now unpopular because of its environmental impact. Any package for the future of Porto Marghera vinyls production had to take into account the cost of both buying this unit and converting it to membrane technology, market sources said.
It is still not clear whether Sator has reached a conclusion with Eni on this issue. The Ineos Vinyls Italia source said: "My feeling is that from now until October 22, Mr Sator and Eni will be in discussions to reach an agreement."
October 22 is not a deadline for a deal to be fixed, but marks the next meeting of the Italian government's Chemicals Committee.
Ineos Vinyls Italia is a separate legal entity to the Ineos Group and produces PVC and VCM at Porto Marghera, Ravenna and Sardinia. At its main production center in Porto Marghera, its production capacities are: 250,000 mt/year of VCM, 400,000 mt/year of EDC and 200,000 mt/year of PVC.
Last week it emerged that a distribution deal between Germany's Vinnolit and Ineos Vinyls Italia for 100% of the output from its 65,000mt/year PVC Porto Torres site had ended.
October 04, 2008 fibre2fashion.com
INEOS begins consultation
on future of its ageing ethylene plant
INEOS has announced its vision for its Grangemouth site, which includes ongoing investment in plant and equipment combined with a full review of older, uneconomic plant. This strategy will enable Grangemouth to realise its full potential and keep it at the forefront of the petrochemical industry.
Tom Crotty, CEO Grangemouth says, “This strategy demonstrates our determination to modernise Grangemouth so that it can maintain its pivotal role in the Scottish economy and at the heart of the Scottish manufacturing industry.”
As part of this long-term strategy, the Company has confirmed investment to modernise its KG ethylene plant, which will enable production of ethylene and propylene from a much wider range of raw materials. The new investment will further enhance KG’s status as a world-class cracker facility.
The Company will also start a formal consultation process on the future of its ageing G4 ethylene plant. One of the options under consideration will be possible closure of the plant at the second half of 2009. However, as part of this consultation we are hopeful we will be able to redeploy staff currently working on this plant were we to decide to close it.
The Grangemouth Unit 4 (G4 40-year-old) can crack 250,000 tonnes of ethylene per annum from both gas and light distillate feedstocks. The Kinneil Grangemouth (KG) unit is a gas cracker using mainly propane and butane as its raw materials. It has a capacity of 450,000 tonnes of ethylene per year. An effluent treatment plant that treats wastewater from both KG and G4 is one of KG's key features. This has radically improved effluent quality and is a testament to BP Amoco's commitment to environmental improvement. Any further waste products from both plants are ultimately recycled or used as fuel. Nothing is wasted.
The two units produce 700KT of ethylene per annum between them, although this capacity will increase to more than 1,000KT per annum by 2001.
The vision being
announced includes reviewing all aspects of how Grangemouth
operates and includes plans to ensure that Grangemouth staff have
the right set of skills and competencies for the future.
INEOS continues to develop ‘new talent’ by recruiting highly qualified, motivated and skilled personnel to support its investment and modernisation plans. The site has recently welcomed 36 new apprentices and graduates onto its highly regarded modern apprenticeship scheme or into full-time roles.
Tom Crotty says, “Since acquiring Grangemouth, INEOS has invested £400 million in the refurbishment of existing plant and technology. This announcement brings a further substantial investment and we now have a major modernisation and investment programme, which demonstrates our long-term commitment to Grangemouth and our staff.”
Chemical group Ineos to sell assets as catalyst to reduce debt burden
Ineos, the chemicals group which is one of Britain’s biggest private companies, is considering selling assets in an effort to reduce its debt burden.
The company, which has expanded rapidly through debt-fuelled acquisitions, is understood to be looking at disposing of a number of businesses in the US, according to people familiar with its plans.
Ineos is run by Jim Ratcliffe, who has become one of Britain’s richest men as a result of the company’s growth.
After graduating in chemical engineering from Birmingham in 1974, he joined Esso. Ratcliffe became a director of Advent International, the private equity group, in 1989 funding investments in the chemicals sector, and used his own money to buy a BP chemical unit for £4m. He created Ineos in 1998 and began buying unwanted subsidiaries from ICI and BP, before buying BP’s entire petrochemicals division, including Grangemouth, on the Firth of Forth for £5bn.
Ineos and the publicity-shy Ratcliffe were relatively unknown until April this year, when workers at the Grangemouth refinery went on strike over pensions. The acrimonious dispute led to widespread media coverage amid fears that petrol forecourts in Scotland could run dry.
Despite the lack of publicity about the business, Ineos has become the third biggest petrochemical company in the world over the last 10 years, behind BASF of Germany and America’s Dow Chemical, with profits of £1.5bn.
Ineos, which has 18 businesses and 16,000 staff across 20 countries, works in the manufacturing, distribution and sales of speciality chemicals and petrochemicals.
Ineos’ expansion has been largely funded by debt with Ratcliffe using a private equity model to grow his business, without having to resort to private equity funds. However, with the financial markets in crisis and the money markets frozen, Ineos has been expected to slow down its growth through acquisitions.
Ratcliffe lives in Hampshire, travels by private jet and lists collecting garden tractors among his hobbies.
Acid test for the Ineos formula
If petrochemicals was a more glamorous sector, Ineos a higher profile company and other sectors not capturing the daily headlines, the company might well have found itself more fully in the media glare.
After all, its highly leveraged business model in a cyclical industry now turning sharply downwards hardly looks the most inviolate from today’s turmoil. The apparently insatiable appetite for more acquisitions has seen Jim Ratcliffe’s business build a massive stable which has put it into third place in the world’s chemical industry rankings. The purchase of Innovene, the former BP Chemicals petchem and polyolefins arm, cost some $9bn by itself and required substantial long term loan funding.
This week, following speculation that conditions might force the sale of some US businesses, Ineos issued a statement reassuring the market of its soundness. The Innovene debt has already been cut by E1bn, it notes, and cash balances stood at E1.4bn at the end of September.
When PRW attended a lecture Ratcliffe gave to students at his almer mater of Birmingham University last year, he pointed to Ineos’s use of high yield bonds with a ten year duration, requiring interest only payments in the interim.
Nevertheless he can hardly have anticipated the storm that has blown up in the financial world and is now being accompanied by rapidly deteriorating conditions in the polymer market. PVC, where Ineos has linked EVC and Hydro, looks particularly vulnerable to the collapse in building activity, for example.
The Ineos strategy of ensuring that its businesses are profitable at the bottom of the cycle looks certain to be fully tested.
Nov 18 2008 (Reuters)
Ineos debt falls sharply on restructuring fears
The value of Ineos Group's senior loans and high-yield bonds fell sharply on Tuesday on continued fears about the highly leveraged company's ability to manage its huge debt.
The drop in the secondary value of Ineos' loans and bonds preceded a downgrade by Moody's on Tuesday, which came a day after Ineos released weak third-quarter results and asked its banks for a two-quarter holiday on its loan covenants to avoid a covenant breach. The markets' reaction shows that investors remain unconvinced that the world's third-largest chemicals company will be able to solve its problems by the end of May and avoid a full balance sheet restructuring on its 7.62 billion euro loan and bonds.
"Ineos is staving off the inevitable balance sheet restructuring. They need to sell assets to preserve their position and are buying five months to pull the rabbit out of the bag," a senior loan trader said.
The value of Ineos' loans initially rose after the waiver announcement on Monday, but started to turn down as the market digested the implication that there may be more bad news ahead for the company.
The company's euro-denominated term loan B and C paper loans lost around two points to 47.50-50.50 percent of face value on Monday, and losses continued on Tuesday as Ineos' second lien loans fell around four points to 25-32 percent, down from 30-36 percent on Monday.
Meanwhile, its bonds fell to be bid at 17 percent of face value and were offered at 19 percent, down from 22-24 percent on Monday, traders said.
Ineos' debt protection cost soared to over 70 percent upfront, indicating that an investor would have to pay seven million euros upfront to protect ten million euros of the company's debt against default.
Sector peer Lyondell Basell's bonds have also fallen sharply in the last two days to 13-15 percent of face value as the outlook for the chemicals sector deteriorates.
DOWNGRADE HURTS CLOs
Moody's downgrade is a heavy blow for funds, particularly collateralised loan obligations (CLOs) that hold Ineos' debt in ratings-linked baskets, and the downgrade could trigger forced selling, traders said.
Moody's cut Ineos' corporate family rating by two notches to B3 from B1 and said it may consider further downgrades. The company's senior first lien loans were cut to B2 and the second lien loans to Caa2, along with the company's bonds.
While Ineos' bankers are expected to approve the waiver in return for increased margins and fees, many believe that the company is facing an uphill struggle as it tries to reduce its debt through asset sales that are difficult to execute amid moribund debt markets.
Ineos is targeting full-year earnings before interest, tax, depreciation and amortisation (EBITDA) of 1.7-1.8 billion euros, but will deduct 400 million euros of inventory holding losses on its 10 million barrel oil reserve and 180 million euros of exceptionals related to Hurricane Ike and a strike at its Grangemouth facility, the company said on Monday.
Traders say that EBITDA of less than 1.2 billion euros will result in negative cashflow that will further reduce Ineos' room for manoeuvre.
"The environment is so bad that all the things that Ineos can do are wiped out by the nuclear bomb out there - the company is too leveraged," the senior loan trader said.
Oil fall forces Ineos to seek bank waiver
Ineos is to seek approval to breach its banking covenants over the next two quarters while it addresses the impact of a major stock loss on oil and a sharp downturn in demand across its polymer portfolio.
However, the grouping is stressing that its liquidity remains sound with nearly ?2bn of funds at its disposal.
The company has already won approval for the move from senior lenders Barclays Capital and Merrill Lynch and will be asking the banks to which the loans have been syndicated to give the waiver the go ahead over the next two weeks, said Tom Crotty, ceo of the olefins and polymers business.
If agreement is reached, it would mean a Euro 50m one-off cost and ongoing Euro 50m increase in the company’s Euro 600m annual interest charges, he added.
The loans, totalling some Eruo 7.3bn, including some long term bonds, are linked to quarterly profits at a specific ratio which are being exceeded by the need to revalue 10 million barrels of oil Ineos bought for its refineries before the price collapse.
“Oil has fallen from $140 to $55 a barrel - resulting in a short term loss, not a cash loss,” Crotty explained to PRW this week.
Ineos is also facing a downturn of up to 30% across the plastics industry, as “everything is reeling from a drop-off in demand”, he said, but remains confident of a Euro 1bn plus EBITDA this year, after the impact of the stock loss and exceptionals.
The company has cut fixed costs by a further Euro 140m this year and has actioned measures for a further Euro 200m cut, lowered working capital, while capital expenditure is being reduced from Euro 600m to Euro 250m next year.
“This has really strengthened our liquidity position,” Crotty said.
Ineos turned in an EBITDA of Euro 402m for the third quarter of 2008, despite stock losses of Euro 100m associated with the falling value of oil and damage resulting from Hurricane Ike. The result took the year to date EBITDA figure to Euro 1.3bn compared with Euro 1.7bn for the same period of last year.
In its financial statement yesterday, Ineos said if oil remains at $60 a barrel, it would be facing a full year stock loss of Euro 400m after a predicted Euro 560m loss in the fourth quarter.
The company, led by Jim Ratcliffe, has built up a stable of chemical and polymer interests in recent years with acquisitions that have included Innovene from BP Chemicals and PVC makers EVC and Hydro Polymers.
“In recent weeks,” explained Ineos cfo John Reece, “it has become clear that the entire industry is now facing a period of unprecedented market turmoil caused by the declining price environment and driven by macro economic uncertainty.
“This is resulting in severe customer de-stocking. While this reduces short term visibility, we believe that the picture will become much clearer at the end of Q1 2009.
“We are therefore requesting covenant waivers from our senior banks for the period to the end of May 2009. At that stage we expect to have clearer visibility which will allow us to deliver the new business plan.
“In the meantime, we have adequate liquidity and expect to remain cash generative.”
Ineos shelves plans for four European biodiesel plants
and refining group Ineos has shelved plans to build four new biodiesel
across Europe due to the current global economic slowdown, the
company said Thursday.
"Given the continued and prolonged global economic downturn Ineos is focusing on tight control of costs and expenditure across its entire portfolio," the company said an emailed statement. "As a consequence, ongoing plans to invest in new additional biodiesel capacity across Europe are on hold until Ineos has a clearer picture of the economic outlook."
Ineos had announced plans to build new biodiesel plants in Antwerp in Belgium, Lavera in France, Grangemouth in Scotland, and either Wilhelsmhaven or Cologne in Germany.
The four new plants were expected to have a total biodiesel production capacity of 2 million mt/year by 2012, with half of that level reached by 2010, a company spokesman said.
The plants in Antwerp and Grangemouth were the largest of the four projects at 500,000 mt/yr a piece, and had been expected to cost some Eur90 million ($116 million) each.
"We haven't abandoned our biodiesel strategy just rescheduled it due to the current economic climate," the spokesman said.
He said work to expand Ineos' existing Baleycourt biodiesel plant in France remains on schedule to reach its full 220,000 mt/yr capacity by year-end.
"Across Europe, manufacturing industry, including chemicals and biofuels, is experiencing a period of unprecedented volatility and uncertainty and accurate forecasting is expected to remain extremely difficult in the short term," Ineos said.
It said, however, it remains "committed" to biodiesel with its current strategy now focused on developing new capacity through acquisitions or collaboration.
Ineos committed to Norway ethylene expansion
British chemicals group Ineos said on Wednesday it was committed to expand ethylene output in Norway and is assessing the costs of a gas separation plant needed for a new Scandinavian gas pipeline.
North Sea gas pipeline operator Gassco has asked Ineos, which has been hit hard by the global credit crunch and economic downturn, to affirm its intension to expand its petrochemicals business in Rafnes, southern Norway, requiring more gas.
"Our long-term plan has always been to expand the cracker at Rafnes to produce more ethylene in Norway," Tom Crotty, chief executive of Ineos Olefins & Polymers Europe, told Reuters.
Ineos became the owner of the petrochemicals business at Rafnes when it acquired Norsk Hydro's polymers business in 2007 and completed the deal in early 2008.
The planned Skanled pipeline would bring North Sea gas and ethane to Rafnes, where a separation plant would be built to siphon off the ethane for Ineos' cracker and send the natural gas on to Sweden, Denmark and possibly eastern Europe.
Russia's row over gas deliveries with Ukraine has cut supplies to other European countries in past days and reignited fears over energy security. Norway is the second largest supplier of natural gas to the European Union after Russia.
Crotty said Ineos was assessing "the latest costs associated with the gas separation plant" and it believed that such a facility "should be considered as an investment in Norwegian infrastructure" to provide feedstock ethane to the region.
"Our interest remains focused on the use of Norwegian ethane in Norway. Investment in a gas separation plant is not our primary goal but means to access ethane for Rafnes," he said in a mailed reply to Reuters questions.
Ineos, whose debt has been put on downgrade watch by Standard and Poor's and Moody's in past months, declined to give any investment estimates or the timeframe for its decisions.
Gassco told Reuters this week that Ineos's ability to carry out the needed investment at Rafnes was among the major risks to the $1.5 billion Skanled link, set to pump up to 25 million cubic metres of gas per day from 2012.
The 453-kilometre pipeline would link the North Sea gas hub at Kollsnes to industrial sites in Norway, Sweden and Denmark.
It could feed gas into the Danish system or be extended across the Baltic Sea to central Europe, which is dependent on Russian energy and is seeking to diversify supplies away from Moscow.
Ineos Vinyls Italia dispute plunges Italian chemical industry into crisis
The collapse in discussions over the sale of Ineos Vinyls Italia’s PVC and vinyl chloride monomer (VCM) operations to Fiorentino Sartor (Safi Spa owner)could bring a major part of the Italian petrochemicals industry to a halt. Trade unions are calling for urgent government intervention to prevent the loss of what they say could be some 5,500 jobs in the sector in the medium term.
Ineos and Sartor late last year reached a preliminary agreement for the sale of Ineos Vinyls Italia’s operations in Porto Marghera, Ravenna and Porto Torres, Sardinia. A definitive agreement had been expected around the end of January, but the two sides have fallen out over the financial details of the deal.
Despite urging by unions and local and national politicians, it seems that the deal is now dead. Unless there is a major change in the course of events, Ineos Vinyls Italia appears set to file for bankruptcy on Wednesday. Its production operations are likely to shut down soon after, putting around 1,500 employees out of work and setting off a chain reaction that could affect much of what remains of Italy’s petchems industry.
What may turn out to have been the tipping point in the negotiations is a separate deal between Ineos and Sartor that turned sour. Last month, Ineos sold its Italian PVC compounding operations - Ineos Compounds Italia - to Sartor. They are now operating as TPV Compounds, a name they operated under until they were acquired by EVC in 1988 (Ineos bought EVC in 2001). Three plants are involved, in Argenta, Frosinone and Villanova d’Ardenghi, with a combined capacity of around 100,000tpa.
According to local reports, Ineos and Sartor were also negotiating the transfer of a fourth PVC compounding operation, in Sins, Switzerland. However, they could not agree a price. This, on top of the difficulties in negotiating a price for the Italian monomer and polymer manufacturing, may have finally persuaded Sartor to leave the negotiating table.
Such is the animosity between the two sides now that TPV Compounds apparently is looking to source PVC polymer from numerous European sources, with the exclusion of Ineos.
Ironically, an earlier obstacle, concerning taxes owing by Ineos to the Italian government, appeared to have been resolved, although there still remained the issue of money due to Eni for supply of feedstocks for VCM production.
Closure of the Ineos operations in Italy will put the rest of the petrochemicals sector, now largely concentrated in the north-east of the country and in Sardinia, in tilt. Ineos is a major user of chlor-alkali supplied by Eni, and the removal of a key outlet will put this business in trouble too. Such a shift in the balance of what is already a delicately poised sector could have further effects that at this point are difficult to quantify.
Ineos finally does deal with Sartor
Italian prime minister Silvio Berlusconi has announced that Ineos and Italian company Safi have signed an agreement at the Ministry for Economic Development for the sale by Ineos of its vinyl chloride monomer (VCM) and PVC production facilities in Italy to Safi, owned by Fiorenzo Sartor.
According to a statement from the ministry, the agreement covers manufacturing in Porto Marghera, near Venice and in the Sardinian towns of Porto Torres and Assemin, which together directly employ 1,100 people. Another 800 are employed by companies servicing these operations.
At the same time, an agreement has also been reached with energy and chemicals company Eni covering restructuring part of its chlorine production facilities (operated by its subsidiary Syndial), upon which VCM production depends.
One stumbling block in the long and tortuous negotiations over the future of the Ineos operations has been the issue of who would foot the bill for upgrading chlorine production from out-dated mercury cell technology to less-polluting membrane technology. The government statement does not specify how the situation has been resolved.
Economic development minister Claudio Scajola said the agreement “has saved an important asset for the Italian chemical industry, even in this difficult economic phase”.
He added that the agreement provides the requirements for a national round-table on the chemical industry for addressing more general problems facing the sector.
Ineos Vinyls Italia PVC, VCM units sale completes: minister
The sale of Ineos Vinyls Italia's
PVC and VCM operations to Italian businessman Fiorenzo Sartor's
company, Safi, has finally been completed after nine months of
negotiations, the Italian Ministry of Economic Development said
"The completion of the acquisition of Ineos Vinyls Italia by Fiorenzo Sartor's company Safi, after complex negotiations is a fundamental for the preservation of the chlorine industry and the future of the Italian chemical industry, by retaining thousands of jobs in Marghera and in Sardinia," the Minister of Economic Development, Claudio Scajola, said in a statement.
The deal, which involves the sale of Ineos Vinyls Italia's plants in Porto Marghera, near Venice, Porto Torres and Ravenna, had come close to collapsing numerous times over the last nine months.
Just this week local Italian newspapers reported Sartor had walked out on negotiations Friday afternoon in reaction to changes in the agreed contract terms.
Sartor was reported by the Italian press as stating: "The negotiations were interrupted because of the unique behavior of the British shareholders who, as has always been their custom, at the last minute, have demanded the signing of an important contract linked with economic content substantially different from those that had been negotiated and incorporated in the preliminary contract signed December 31 2008." However, talks were back on again Tuesday, after Fiorezo was persuaded to return to the negotiating table.
Prior to this, the deal had run into problems earlier in February, this time as it hinged on a solution being found to a long running dispute over chlorine supply to the Porto Marghera site.
Only after two days of lock-out negotiations, involving the Italian Ministry of Economic Development, Ineos, Fiorenzo Sartor and Eni, a preliminary deal involving the sale of Ineos Vinyls Italia's plants in Porto Marghera, near Venice, Porto Torres and Assemini, was reached.
This also included an agreement with Eni for restructuring of of Syndial's 200,000 mt/yr chlorine production plant. (Syndial is a division of Eni).
At the main production center in Porto Marghera, production capacities are: 250,000 mt/year of VCM, 400,000 mt/year of EDC and 200,000 mt/year of PVC.
Neither Safi or Ineos Vinyls Italia were available for comment by time of print.
Ineos Vinyls Italia is a separate legal entity to the Ineos Group.
May 6, 2009 Reuters
Ineos asks for covenant waiver extension
* Ineos requests lenders to be given time to assess plan
* Business plan about to be presented to lender group
* Lender group appoints financial advisers
Ineos Group, the British chemicals group, has asked for an extension of covenant waivers to allow a group of lenders to review a new five-year business plan, the company said on Wednesday.
A "sounding group" of lenders has appointed Deloitte as accounting adviser and Houlihan Lokey as financial adviser to assess the plan, Ineos said. The company is being advised by Lazard & Co.
"As a result of the proposed appointment of advisers to the sounding group, the recent delivery of the operating budget for 2009, and the imminent delivery of the group's five-year business plan, Ineos is requesting an extension to the waiver of the requirements to test certain financial covenants," it said.
Lenders have until May 22 to respond to the request. The waiver would run until July 17.
Ineos forecast it would have sufficient cashflow to meet this year's debt obligations whether or not trading conditions improve, confirming an earlier Reuters report citing a source with knowledge of the situation.
Ineos said it projected 2009 full-year revenues to total 15.2 billion euros ($20.24 billion) while it budgeted replacement cost earnings before income, taxes and amortisation to be 1.1 billion euros.
Ineos, which owes a total of 7.5 billion euros ($9.99 billion), secured a six-month covenant waiver in December as it ran close to breaching restrictions on its debt, which gave it time to present a new business plan to lenders.
Part of the plan, drawn up by accounting firm KPMG, addresses the future capital structure for the firm, another source close to the situation said. Discussion between the firm and lenders would likely focus on the appropriate debt level of the firm in the future, the source said.
The business plan has taken some time to put together because of the size and complexity of Ineos, the source said last month when the company released its latest trading figures.
Ineos was Britain's biggest private company by both sales and profit in 2008, according to the Sunday Times.
In the credit default swap (CDS) market, the cost of protecting its debt against default has fallen over the last week but remained at high upfront levels, meaning sellers of the CDS demand a large downpayment for offering coverage.
Five-year Ineos CDS has tightened by about five percentage points since last week to be bid at about 64 percent of face value.
Ineos bonds, maturing in 2016, have rallied over the last week to be traded at 18 cents in the euro from around 10 cents, following a tender offer as part of a lawsuit settlement.
Ineos employs about 15,000 people. Jim Ratcliffe, one of Britain's wealthiest businessmen, created the firm by buying up non-core assets of big chemical companies. ($1=.7510 euros)