APLA ’08: Prodesal acquisition fails - Mexichem

16 November 2008 19:29  [Source: ICIS news]

RIO DE JANEIRO (ICIS news)--Mexichem remains interested in acquiring a chlor-alkali producer following the breakdown in negotiations to purchase Prodesal, chief executive Ricardo Gutierrez said on Sunday.

The Mexican chemicals producer announced at the beginning of this year that it planned to purchase chlor-alkali producer Prodesal, which has a plant in Cali in Colombia, from Peruvian group Quimpac.

“Unfortunately at the last moment, we couldn’t close the deal,” said Gutierrez on the sidelines of the Latin American Petrochemical Association (APLA) annual meeting. He said financing was not the reason for the negotiations to fail, but declined to provide further details.

“We would still be interested in a chlor-alkali acquisition,” Gutierrez said. Colombia has a deficit in caustic soda, which is commanding high prices at the moment, he added.

Growth through acquisitions is a key part of the strategy of Mexichem, which has announced a string of deals this year.

Despite the global financial crisis, the company will continue its expansion plan, which will be combined with improvements in efficiency and integration of production, Gutierrez said. “We have to continue the expansion,” he said. “The challenge is how to continue.”

Acquisitions will compensate for the downturn in the cycle, he explained.

The cost-cutting programme will involve modernisations and automations, enabling Mexichem to increase its output with the same number of employees, he added.

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By: Anna Jagger
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