Polialden’s incorporation into Braskem was approved by an Extraordinary Meeting held today, May 31st, by both companies, and that put an end to Braskem’s partner integration process into its initial structure, a result of its creation based on the association of six companies.

"Polialden’s incorporation was based on the interest alignment of all shareholders, and will allow those migrating to Braskem to have the differentiated benefits offered to all its shareholders, such as the 100% tag along in case of control alienation", says Paul Altit, vice-president of Finance and Relations with Braskem’s Investors.

Before the incorporation, Braskem had 100% of Polialden’s voting capital and around 63.7% of its total capital. From now on, holders of Polialden’s remaining preferred shares will be able to exchange them for Braskem’s A-Class preferred shares, in the ratio of 1,000 Polialden’s shares for 33.62 Braskem’s shares, an offer based on assessment reports of both companies, issued by PricewaterhouseCoopers Auditores Independentes. This proposal represents a 6.76% premium over the exchange ratio from the assessment of net worth for the market price, showing Braskem’s interest in incorporating Polialden.

In order to keep the capital structure in force at Braskem, AGE has approved the conversion of the company’s 2,632,043 A-Class preferred shares into ordinary shares, besides the issue of Braskem’s 7,878,825 A-Class preferred shares, which will have an increase of R$ 105,3 million in its capital stock, expanding its share base in the market - Braskem’s free floating will be increased to about 53%.

Starting today (May 31st, 2006), Polialden’s minority shareholders will have to retreat up to July 1st if they do not want to accept the exchange for Braskem’s shares. In this case, they will receive R$ 0,449 per Polialden’s preferred share they hold.