BRASKEM AND STYROLUTION PLAN JOINT VENTURE TO PRODUCE ABS IN BRAZIL
The new joint venture would be the only producer of ABS and SAN specialties in South America.
If the project is confirmed, the plant will have annual output of 100 kton and support the growth of clients in a wide range of industries through guaranteed supply and local service.
São Paulo and Frankfurt, October 14, 2013 - Braskem, the Americas' leading producer of thermoplastic resins and the world's leading biopolymer producer, and Styrolution, a global leader in the styrenics, announced today the execution of a memorandum of understanding (MoU) to assess the possibility of forming a joint venture in Brazil. The JV will be responsible for analyzing the economic feasibility of installing a plant with production capacity of 100 kton/y of styrenics specialties and the copolymers acrylonitrile butadiene styrene (ABS) and styrene acrylonitrile (SAN) to serve clients in Brazil as well as the rest of South America.
In recent years, Brazil has observed strong growth in the home appliance and automotive industries, both of which are key clients of the styrenics specialties to be produced by the joint venture. Traditionally, ABS and SAN have been imported into the region by styrenics suppliers such as Styrolution. The new company created by Braskem and Styrolution will seek to take advantage of this favorable market dynamic to create a local product that should ensure clients better service and more secure supply.
Styrolution will contribute with its expertise in developing and producing styrenics, the industry's largest product portfolio, the licensing of technology and its existing businesses in the region. Meanwhile, Braskem, as one of the region's leading major petrochemical producers, will provide the supply chain infrastructure and the site for installing the plant.
The consummation of the joint venture is subject to approval by the regulatory and antitrust agencies. The plan is for Styrolution to be the majority shareholder with 70% of the company and for Braskem to hold the other 30%. Subject to the conclusion of an agreement between the parties and the respective approvals by government agencies, the plant's construction is expected to begin in early 2015, with production most likely starting in 2017.
"Styrolution recently unveiled a new strategy which calls for a shift in three areas of our business, namely expanding our footprint in emerging markets, growing our specialty styrenics business and focusing on select, higher-growth industries," said Roberto Gualdoni, CEO of Styrolution. "For Styrolution, this proposed joint venture ticks all the boxes and we are pleased to be partnering with Braskem to explore the opportunities this could afford us."
"This partnership represents an important step towards strengthening Brazil's petrochemical industry. It will also help develop local business opportunities in areas like ABS, in which Brazil currently relies on imports, by attracting new investments to derivative material chains," said Carlos Fadigas, CEO of Braskem. "Relying upon Styrolution's expertise in specialty styrenics, we hope to design the best solution to make this important project viable."
Braskem expands its biopolymer production by 30% following an investment of US$ 87 million
Braskem Idesa and Advario formalize partnership for the Terminal Química Puerto México project in Veracruz
Braskem and Nexus Circular Strengthen Relationship Through a Long-Term Contract for Circular Plastic Feedstocks from New Advanced Recycling Facility
Braskem Announces Project to Evaluate Production of Bio-Based Polypropylene
Braskem Announces a New Renewable Innovation Center In Lexington, Massachusetts