14 February 2001 15:55 [Source: ICIS news]
LONDON (CNI)--Anglo-American energy and chemicals group BP announced on Wednesday that it expects to acquire 100% ownership of the German petrochemicals joint venture Erdolchemie on 1 April this year.
BP said negotiations to acquire the 50% stake in Erdolchemie held by Germany chemicals and life sciences group Bayer were progressing well.
"Both sides are optimistic that remaining issues will be resolved in time for a target completion date of 1 April 2001," said BP's German subsidiary in a statement.
It pointed out that the deal would be subject to approval by European regulatory authorities and the management boards of both companies. After this, full ownership and control of Erdolchemie GmbH will transfer to Deutsche BP AG.
Neither BP nor Bayer have disclosed the financial terms of their transaction. However, analysts have suggested that BP would have to pay at least Euro400m ($370m) and possibly up to Euro600m for Bayer's stake.
The acquisition will reinforce BP’s global position in polyethylene (PE), acrylonitrile (ACN), ethylene oxide (EO) and its derivatives and aromatics. On completion of the deal, Erdolchemie will account for approximately 15% of BP’s worldwide petrochemical capacity.
Located in Worringen, near Cologne, Germany, Erdolchemie employs some 2200 people and had a turnover in 1999 of more than DM2.5bn ($1.18bn/Euro1.28bn), said BP. Erdolchemie produces over 4.2m tonne of petrochemicals annually: its main products include ethylene (900 000 tonne), propylene (560 000 tonne), and PE (540 000 tonne).
In April last year BP and Bayer agreed to a 200 000 tonne/year ethylene cracker expansion at Worringen. The investment programme will continue under single ownership, said BP.
BP said the deal will represent a significant step in its Northwest European petrochemical strategy. The acquisition of the whole of Erdolchemie will reinforce BP’s chemicals business in the region, which already includes major derivative plants in Marl, Germany and Geel and Feluy in Belgium.
BP and Bayer will continue to be significant business partners and neighbours, with BP supplying a number of important chemical raw materials to many Bayer factories and Bayer continuing to supply services to the Erdolchemie site.
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections