January 16, 2004 BRASKEM

Braskem incorporates Trikem and moves forward with its corporate integration
http://www.braskem.com.br/upload/TRIKEM_final_15jan2004_english.pdf

BRASKEM S.A., the leading manufacturer of thermoplastic resins in Latin America, positioned among the five largest private-sector industries in Brazil, announced that, at an Extraordinary Shareholders’Meeting held yesterday, the shareholders of Braskem S.A. (“Braskem”) and Trikem S.A. (“Trikem”) approved the incorporation of Trikem by Braskem.
This merge concludes successfully one of the most important steps of Braskem's integration process, as well as of the restructuring of the Brazilian petrochemical sector. By means of the conclusion of this incorporation, Braskem's free float will increase up to 33% from the current 25% level. Such outcome is in line with the company's goal to obtain higher liquidity levels for its shares and to increase its trading potential in the international capital markets.
“The incorporation of Trikem further strengthens Braskem's position as the regional market leader, with a fully integrated business model, focused on value creation for all its shareholders", says Jose Carlos Grubisich, Braskem CEO. One of the main benefits provided by this operation is to speed-up the capture of synergies originated from Braskem’s integration process, further increasing the company's competitiveness.
The exchange ratio offered by Braskem to Trikem preferred shareholders was of 3.47 Trikem shares per one preferred class "A” Braskem share, which was the same exchange ratio used in previous societary steps involving the migration of holders of Trikem common stock into Braskem. “Aligned with Braskem's own Public Commitment since its inception, Trikem's merger follows modern principals of corporate governance, aiming at aligning interests of both companies' shareholders”, says Paul Altit, Braskem Finance and Investor Relations Vice-President.
One of the resulting benefits of the incorporation of Trikem is to simplify Braskem's corporate structure, facilitating the understanding of the Company's performance indices by the financial community. Furthermore, shareholders choosing to migrate their equity interests to Braskem will enjoy 100% tag-along rights offered by the company to all shareholders, in the event of a change in Braskem's control, preserving their interests in equal conditions to the controlling shareholders.
In March 2003, Braskem completed the incorporation of OPP, Nitrocarbono and ESAE. Last July, the company acquired the shareholding stake that the Japanese group Mitsubishi held in the voting stock of Trikem and Polialden, while at the same time entering into an agreement with Nissho Iwai to migrate its equity interest to Braskem. On December 4, Braskem successfully concluded a public offering of the remaining Trikem common stock in the market, which was followed now by the current merger.
In 2003, Braskem level II ADRs listed at the NYSE presented the best performance world-wide, whilst, in the same period, its shares traded at BOVESPA (Sao Paulo Stock Exchange) registered one of the best performances overall in the Brazilian stock market. Recently, Braskem shares daily trading volumes have been consistently increasing in both international and local stock markets. With the incorporation of Trikem, Braskem attains a market capitalization of approximately US$ 2.0 billion.
Braskem, a world-class petrochemical company, is the leader in thermoplastic resins in Latin America and is positioned among the five largest private-sector industries in Brazil. With 13 industrial plants located in the country, the company has an annual production capacity of 5 million tons of chemical and petrochemical products.

---

December 9, 2003 BRASKEM S.A.

RELEVANT FACT (OdenrechtからのTrikemの分離）
http://www.braskem.com.br/upload/Fato%20Relevante%20Final%20Odequi%20-%20FINAL%20-%20ING%202.pdf

In compliance with CVM instructions No. 319/99 and No. 358/02, BRASKEM S.A. (“Braskem”) notifies its shareholders and the market of the following:
This Relevant Fact is about transactions to be completed prior to the merger of Trikem S.A. (“Trikem”) into Braskem,described in a joint relevant fact from Braskem and Trikem, published on this date. The transaction described in this Relevant Fact has as its purpose the simplification of Braskem's corporate structure, directly linking Trikem to Braskem in a manner to facilitate the merger of Trikem into Braskem.
In this context, on December 9, 2003, Braskem's Board of Directors and Fiscal Council approved the proposal for transfer of a portion of the assets of Odebrecht Quimica S.A. (“Odequi”), a company in which Braskem holds 100% of the voting capital stock and 98.63% of the total capital stock. Braskem's Board of Directors also approved the convocation of an extraordinary meeting of Braskem's shareholders in order to deliberate concerning this transaction, to be held on January
12, 2004.
The portion of Odequi's assets to be spun-off is comprised of all of its shares in Trikem, equal to 13,841,438,730 common shares and 11,123,910,124 preferred shares, representing 64.43% of Trikem's voting capital stock and 41.02% of Trikem's total capital, appraised at R$1,082,647,948.57 based on its book value as of 10/31/2003 (“Base Date”).

2004/2/4 Braskem

Braskem announces investiment of R$ 90 million
Industrial Unit in Alagoas will have its capacity increased by 50 thousand tons/year
http://www.braskem.com.br/upload/Rel20040204_Braskem%20announces%20investiment%20of%20R$%2090%20million.pdf

Braskem decided to invest R$ 90 million in the expansion of its PVC unit in Alagoas, based upon the perspectives of this resin consumption growth in the next years. The investment will allow an additional offer of 50 thousand tons of PVC, what represents a growth of 25% in the installed capacity of Braskem PVC in Alagoas.
This expansion will result in competitiveness improvement and the company’s total resin production capacity will reach 530 thousand tons/year, available in the market in the next year. The announced investment has the potential to generate an additional revenue of R$ 100 million/year and it is part of a program developed by Braskem to increase the PVC production capacitiy to 630 thousand tons/year, to be implemented along the next years.
“This initiative proves that Braskem believes in a new development cicle of the country and also draws attention to the company commitment to the improvement of the petrochemical and plastics productive chain competitiveness in Brazil”, says Jose Carlos Grubisich, president of the company.
The crescent use of PVC in a wide variety of sectors offers this resin an outstanding potential of market development. Besides traditional use in civil construction and infrastructure, announced as government priorities, the PVC has been present in agribusiness, cosmetic and food packagings, shoes and medical area, among others. “Braskem has identified new expansion opportunities, as part of a strategy that keeps up with the market growth and reinforces its leadershio in the regional PVC market”, says Bernardo Gradin, vice president of Braskem Vinyl Unit.
This first step of the expansion program creates 500 job opportuinities in civil construction and will open 30 new oportunities in the company’s staff for qualified professionals.
Nowadays, the company generates 450 direct jobs and 2 thousand indirect jobs in Alagoas.

Braskem is also investing in the expansion of Polypropylene capacity in Triunfo, Rio Grande do Sul. The construction work started in 2003 and will be concluded in 2004, offering 100 thousand tons/year, or 20% of the present Braskem Polypropylene capacity
The competitiveness of this investment, $ 20 million, is incomparable.
Furthermore, the company has already started research to enhance Polyethylene production. “Once the plastic industry plays an important role in almost all productive chains, we have to antecipate the market trends and take the lead of investments. We are doing our best”, concludes Grubisich.
Braskem, a world-class Brazilian petrochemical, is a leader in thermo-plastics in Latin America and it figures among the five biggest Brazilian private industrial companies.
Braskem’s 13 industrial plants are located all over the country and they produce 5 million tons
of petrochemical produts annually.

---

February 5, 2004 BNamericas.com

Braskem to invest US$31mn to boost PVC output

Brazil's largest petrochemical group Braskem will invest 90mn reais (US$31mn) to expand PVC production by 50,000 tonnes a year (t/y) at its Marechal Deodoro plant in Alagoas state, Braskem president Jose Grubisich said in a teleconference Wednesday.
The idea is to take advantage of an expected economic recovery led by the construction, and water and waste sectors, he said. "According to our studies, this option has the lowest cost per tonne and the best return on investment," the executive said, since the whole production chain is located in the same area. "It is part of our strategy to allocate resources to boost returns, and reduce and lengthen debt."
The expansion includes the construction of a new ethylene dichloride cracker and reactors that would start operations in the second half of 2005, Grubisich said.
The investment aims to reduce bottlenecks at the Alagoas plant, since the production capacity of raw materials is greater than the capacity for the end product itself. The technology employed in the expansion is fully owned by Braskem, the official added.
The new capacity should increase revenues by 100mn reais a year and guarantee the company's position as regional leader in PVC production, according to Braskem.
Braskem has current PVC production capacity of 480,000t/y in three units. In Alagoas, its plant has capacity of 204,000t/y, the Camacari plant in Bahia state has 250,000t/y capacity and there is an additional 25,000t/y at the Sao Paulo plant.
Output is currently at 90% of total capacity and supplies 71% of the Brazilian PVC market. The group expects to reach full capacity in 2004 thanks to economic recovery.
"There is a housing shortage of 6.7 million units in Brazil and a high number of towns with no drinking water or sewerage systems," Braskem vinyls director Bernardo Gradin said.
Tubes and connections account for about 52% of the local PVC market and Braskem hopes the new usage of PVC in packaging, construction and the shoe industry will increase demand.
The company plans to use its own resources for 30% of the investment and is seeking the remaining 70% from the country's national development bank BNDES or regional development bank Banco do Nordeste.
Braskem's board has approved the new investment, which is part of a larger plan to expand annual PVC production to 630,000t by 2007. "This is a three-step process that depends on the confirmation of market growth expectations," Grubisich said.
The second step will be to add another 50,000t/y capacity by mid-2006 and the final step another 50,000t/y by 2007. Grubisich said that the PVC market normally grows at twice the rate of GDP, which the government forecasts at 3.5% for this year
The company plans to sell most of the output in the country's industrial hub of Sao Paulo and in the southern state of Santa Catarina, where there is high demand for PVC products.

March 24, 2003 Braskem

BRASKEM PROCEEDS WITH ITS INTEGRATION
http://www.braskem.com.br/upload/Release_incorporacao_Nitro_versao0_19-03-2003_english.pdf

Braskem S.A. (BOVESPA: BRKM) (NYSE: BAK) today announced that the Boards of Directors of Braskem S/A (“Braskem”), Nitrocarbono S/A (“Nitrocarbono”), Economico S/A Empreendimentos (“ESAE”) and OPP Quimica S/A (“OPP”) have approved the scheduling of Extraordinary Shareholder Meetings to
vote on the incorporation of Nitrocarbono, ESAE and OPP into Braskem. The meetings will be held on March 31, 2003.
This step represents further progress in Braskem's corporate integration process, which began with the public tender offer for Nitrocarbono S/A's outstanding common shares (as announced on March 13, 2003). Below are further details regarding the offer:

These steps further confirm Braskem's commitment to progress with its integration process, which aims at yielding synergy gains for all companies involved.

Braskem is a world-class Brazilian company, leader in the thermoplastics segment in Latin America and among the five largest Brazilian private industrial companies.

2005/10/10 Platts

Petrobras wants operating role in petrochemicals ventures: CEO

Brazilian oil company Petrobras wants to play a major operational role in petrochemicals ventures it holds stakes in, CEO Jose Gabrielli told reporters Monday, signaling the company is no longer content with simply financing Brazil's largest petrochemicals players.
"We do not want to continue merely as financial partners with minority stakes in petrochemicals ventures," Gabrielli said at an event to announce the construction of new oil tankers. "We want to be in ventures where we are guaranteed an important operational role."
The statements came in response to questions about whether Petrobras will exercise its option to increase its stake in Latin America's largest resins maker, Braskem, to 30% of voting shares from about 10% it holds now.
Petrobras has until next March to decide whether to use the option, but it has already picked some assets it would have to get rid of under shareholder agreements if it decides to buy more of Braskem. For instance, a boost in Petrobras's stake in Braskem would give the state-run oil company a larger say in operations at the Camacari petrochemicals complex in the northeast state of Bahia, but it would force Petrobras to divest its 15% stake in Copesul, Brazil's southern ethylene complex, ceding the stake to Braskem's current largest shareholder, Odebrecht SA.
Until recently, Petrobras had said it wanted to leave most petrochemicals activities in Brazil in the hands of private companies while concentrating on other aspects of its business, such as offshore oil production. However, it subsequently announced plans to build a $3.5-bil refinery to produce petrochemicals feedstocks and upped its budget for other petrochemicals projects, signaling it is still keen to have partial control over the sector.